Canal Expansion stop work threat akin to extortion

FORMER Panama Canal Administrator Alberto Aleman Zubieta said that he does not believe that the consortium working on the third set of locks for the Canal expansion will suspend work.

But he believes that the announcement by Grupo Unidos por el Canal (GUPC) that it would halt work on unless it is paid $1.6 billion in overages is akin to extortion.

GUPC directors said the consortium would halt work if the authority does not agree to pay the overages, which is 50 percent of the total project cost.
Aleman Zubieta said that abandoning the work would have serious consequences for the companies involved reports La Prensa.
"This is work that is secured," the former administrator said, pointing out that the consortium has a $600 million bond with insurance company Zurich to ensure the project is finished.
Aleman Zubieta's comments were made after news surfaced Wednesday, January 1 that GUPC has said it will halt work in three weeks if the overages are not paid.
GUPC is comprised of the Spanish company Sacyr Vallehermoso, Italian company Impregilo, Belgian company Jan de Nul and Cusa of Panama.
The Canal administration (ACP) has rejected the company's request, saying that there are measures in place to deal with cost overruns. The Canal says the company's threat to halt work is an attempt to circumnavigate the contract.
."I hope it is not the intention of any of these companies to suspend the work," said Aleman Zubieta's adding that the contract should be respected by both sides.