The consortium that built the new third locks of the expanded Panama Canal could be intending to claim as much as $2bn in cost overruns on the project, according to Spanish newspaper El Pais.
While unofficial speculation during the delayed project put the estimated cost at $5.6bn (compared to an initial budget of $3.2bn), the new report refers to Panama Canal Authority (ACP) accounts showing that the consortium GUPC has formally reserved the right to claim $5.67bn.
It is partly a procedural necessity as the terms of the original contract require GUPC to make such claims within a certain time period of the expanded Canal beginning operations, or lose the right to do so later on. The expansion was opened on June 26, 2016.
GUPC (Grupos Unidos por el Canal) is led by Spanish company Sacyr Vallehermoso. The consortium also comprises Italy’s Impreglio, Belgium’s Jan De Nul and Panama’s Constructura Urbana.
The third locks were the key element of the Canal’s expansion. Since its June inauguration the Canal has been able to receive much bigger ships, notably Neo Panamax container vessels carrying three times the previous maximum number of containers.
GUPC blamed the delays and overruns on faulty geological data provided by the Panama authorities, regulatory restrictions and labour disputes. Critics of the consortium accused it of making an unrealistic bid from the outset.