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Ilisu Dam in doubt as BB/Impregilo pull out

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MAJOR DOUBT was cast on construction of Turkey's controversial Ilisu Dam after UK contractor Balfour Beatty quit the project this week.

Balfour Beatty walked away from the project along with its partner, Italian contractor Impregilo. The move effectively destroys the civil engineering consortium, which now has just three Turkish firms.

The contractors' exit from the consortium follows that of Skanska last September, and has cast doubts over the project's viability.

'The fact that three of the largest international contractors have now pulled out gives very strong signals, ' said a BB spokesman.

Balfour Beatty said that it saw no solution to the commercial, environmental and social obstacles involved in the project. 'No further action or expenditure by Balfour Beatty on this project is likely to resolve the outstanding issues in a reasonable timescale, ' said chief executive Mike Welton.

The major obstacle has been demands from the UK's Export Credit Guarantee Agency that has set out four key conditions against guaranteeing loans.

These conditions concern resettlement and compensation plans; architectural and cultural rescue plans; plans for the downstream flow of the Tigris River; and plans for purification of the reservoir water when constructed.

The contractor had also come under increasing pressure from environmental groups over its part in the project.

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