The Panama Canal Authority (PCA) and the consortium building a third set of locks for the inter-oceanic waterway said in separate statements that they will take a dispute over cement quality to international arbitration.
The PCA has asked for an international arbitration panel to review a decision to award US$233 million to the consortium expanding the canal in a dispute over cement quality.
The consortium, led by Spain’s Sacyr and Italy’s Salini Impregilo, and including Belgium’s Jan de Nul and Panama’s CUSA, said in January it had won US$233 million of the US$463 million it claimed in the dispute.
In the latest chapter of an often thorny relationship between the authority, known as the ACP, and the Grupos Unidos por el Canal consortium (GUPC), the latter said Tuesday it has filed a request for international arbitration as it seeks an award of $345 million.
The request for arbitration comes 56 days since the issuance of a decision by a panel created by the contractor and the Canal Authority to resolve disputes. Under the terms of the contract, both sides have the right to appeal the decision of the panel to the court of arbitration.
Arbitration is the last resort of the mechanism established in the contract for the design and construction of the new locks. It will be held in Miami.
The consortium has filed a series of claims totaling some $2.3 billion over the dispute that halted work early last year on the expansion to allow bigger vessels to pass through the canal.
I don’t know the details of this dispute but based on the hundreds of major projects I have been involved in the root of the problem is usually incomplete or incorrect engineering. Contractors do their work according to instructions from engineers including blueprints specifications and verbal instructions. Then when something goes wrong, everyone blames the contractors. Sometimes the contractor is at fault, but most of the time he is just doing what he is told to do.