News - Budapest metro mud may be cleared up after all - paper

The latest chapter in Hungary's Metro 4 scandal may come to an end, local daily Népszabadság reported. The most likely scenario is that the Budapest Transport Company (BKV) acknowledges some of metro constructor Bamco's claims and pay up a few billions of forints. The nationalization of the borers would bring about litigation of tens of billions of forints, the paper added.

There is a 70% chance of BKV reaching a deal with Bamco and pay at least a part of the tunnel driller's HUF 35 billion claims. There is, however, still a 30% chance that their contract will be terminated, Népszabadság said.

If Bamco fails to re-ignite the borers, Budapest will say goodbye to the constructor and it will complete tunnel drilling itself.

Bamco wants Budapest to pay a total of HUF 35 billion for additional work on the project within a month. It threatened to pull out of the deal if BKV refuses to make payment.

Metro project company DBR Metro called on Bamco consortium, which comprises French-owned Vinci Construction, Austria's Strabag and Hungary's Hídépítő, to continue the works. DBR said that under the terms of the contract Bamco would need to leave all of its equipment on site and hand over the job to its successor or to DBR.

Bamco would regard this as a “nationalisation" of the borers and pledged to turn to court should it come to that. If BKV lost the case it would be obliged to pay Bamco damages plus interest which would be tens of billions of forints.

Some believe the current Bamco-BKV skirmishes are but part of a PR campaign aimed at creating a diversion so that the public and the press would not dissect the fact that trial runs on Budapest's fourth metro line are now scheduled to be launched only at the end of 2012 instead of end-2011. The test runs could last as long as six months.

Source: www.portfolio.hu