Gibraltar Government has terminated the OHL tunnel contract after discrepancies with the company over its performance and lack of progress on the completion of the project.

It follows much speculation over the delayed works following reports of contamination of the subsoil, and that the company was demanding additional funding from government to complete the project.

The tunnel which would go underneath the runway is part and parcel of the strategy to maximise the Government’s new multi-million pound air terminal building – a central component of the expansion of air services to Gibraltar.

 

A Convent Place spokesman said: “The Government has given the contractor of the tunnel contract OHL, 14 days notice to terminate the contract and expel them from the site. The effective date of termination will be August 12th.

“The grounds for such termination are the contractor’s failure to comply with the terms of the contract and to proceed with the works as required by the contract.

“The Government will make alternative arrangements to proceed expeditiously with the completion of the tunnel and related works included in the contract.

“The contractor’s performance and lack of progress has left us with no alternative but to take this action as soon as we have been advised that it is legally prudent to do so. “The Government honours its contractual commitments and expects its contractual counterparties to do so as well. Taxpayers are entitled to the benefit of bargains struck on their behalf and therefore contracts bind and benefit both sides in equal measure.”