PANAMA CITY, (Reuters) – Flawed geological studies of the terrain of the Panama Canal by its operator has led to big cost overruns in the project to expand the waterway, the building consortium at the center of a dispute with Panama’s government over the plan said on Saturday.
Earlier this week, the consortium led by Spanish builder Sacyr said the scheme to build a third set of locks for the canal had incurred additional costs of $1.6 billion, and demanded Panama foot the bill or work would be suspended.
Panama rejected those arguments, but has hinted it could negotiate some kind of compromise with the consortium, which also includes Italy’s Salini Impregilo, Belgium’s Jan De Nul and Panama’s Constructora Urbana.
Complaints by consortium officials on Saturday about geological problems provided some of the most detailed explanations yet on what pushed costs above the projections to expand one of the world’s major maritime cargo routes.
The consortium known as Grupo Unidos por el Canal (GUPC), on Saturday reiterated that it did not plan to abandon the project, but would suspend works on Jan. 20 if no deal was reached.
