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JVfaces axe in Boston Artery costs wrangle

THE BECHTEL/PARSONS Brinckerhoff joint venture in charge of the biggest civil engineering project ever attempted in the US is facing the axe after refusing to pay the client $250M (£170M) in compensation for cost overruns.

The project client, Massachusetts Turnpike Authority, is expected to hold a board meeting on Wednesday to vote on whether to ditch the joint venture, which was appointed in 1985.

Embattled managers on the massive project are attempting to replace the Interstate I-93 viaduct through Boston with an eight lane tunnel. This highway will then connect to Logan Airport via a new tunnel south of the city.

The vote was triggered after joint venture B/PB refused to pay the client compensation for failing to control the cost of the project. This has soared from an estimated £7.2bn to £9.7bn in the last two years, leaping £270M in the last few months alone.

The joint venture, which is being paid fees of £1.3bn including £73M profit, has offered to forego its remaining £13M fees if the current outturn cost goes up again.

It claims it is not responsible for cost overruns as it was prevented from reassessing costs on the project from 1995 onwards by the then chairman of the MTA James Keraioates.

However, an MTA spokesman said this week that negotiations with B/PB may last beyond next week in an attempt to reach a compromise.

'We've issued an ultimatum to B/PB and negotiations are at a starting point, ' he said. 'There is concern that replacing B/PB will add more delays and costs to the project, but there are at least two major US consultants interested in taking over.'

But is feared that further cost overruns could arise from problems with the 335m long immersed tube tunnel that connects the I-93 highway with Logan Airport.

Water flowing beneath the western side of the tunnel box has already held up work, delaying completion from September to December 2002. Grouting through the base of the tunnel is now needed to seal the area and could lead to another £40M cost overrun.

INFOPLUS www. bigdig. com

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