Hyundai says $740 million Chilean bridge project on track after cost dispute

Hyundai Engineering & Construction Co

17/02/2020 16:12

By Natalia A. Ramos Miranda
    SANTIAGO, Feb 17 (Reuters) - South Korea's Hyundai
Engineering & Construction Co Ltd  000720.KS  said on Monday it
has resolved a dispute with the Chilean government over a $740
million suspension bridge in a deal that had required it to
"give up its rights" in various areas. 
    Hyundai has struck a deal so it can mitigate the losses it
has already suffered, it said in a statement emailed to Reuters.
    The company reported at the end of December that it was
"impossible" to continue construction of the southern bridge
because Chile's Ministry of Public Works was trying to expand
the scope of the contract without due compensation.
    The firm leads the Puente Chacao Consortium (CPC), which won
the $740 million tender in 2013 to link the continent with the
Chiloe archipelago, some 1,000 kilometers south of Santiago.
    The Chilean government claimed HDEC had sought to increase
the cost of the project by 50%, or $300 million, a request
rejected by the current government of President Sebastian
Pinera.
    Last Thursday, Pinera said bridge construction was going
ahead, adding: "there were some differences that have to do with
costs and who should bear them, but that is already resolved."
    On Monday, the company said it has given ground on
unspecified areas to allow the stalled project to get back on
track. 
    "This agreement requires Hyundai to give up several of its
rights in order to reach an agreement and mitigate the losses it
has suffered so far, which demonstrates its commitment to Chile
and the Chacao project," said Ji Sang Ju, vice president of
HDEC's Infrastructure and Environment division. 
    The agreement is expected to be formalized in later
February, the statement added. A spokesman for the CPC did not
immediately respond to a Reuters request for further
information.

 (Reporting by Natalia Ramos in Santiago
Writing by Aislinn Laing
Editing by Matthew Lewis)
 ((Aislinn.Laing@thomsonreuters.com
+56 223704250;))