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Utilities contractor set to walk off £150 million sewerage job Local subbies fear blacklist Water giant hit by Bangkok-up

UNITED Utilities is set to walk off site at its first - and last - disastrous venture into international contracting.

The company's North West Water International (NWWI) subsidiary has suspended work on the £150 million Bangkok sewerage scheme, which is 80 per cent complete.

The move has provoked outrage among NWWI's local partners and subcontractors.

United has already made a £90 million provision for losses on the job. The firm's chiefs have vowed to pull out of direct contracting following the Bangkok debacle.

NWWI cited continuing payment problems with the client, the Bangkok Metropolitan Authority (BMA), and long-running difficulties getting site possessions as the main reasons behind the suspension of work.

A United Utilities spokesman said: 'We are working to try to resolve the situation. The consortium remains committed to completing the project as long as the BMA can deliver solutions to the problems encountered.'

But Denton Udall, project director on the contract, said pulling out was an option.

He said: 'United Utilities has already made a £90 million provision. The company can only go so far down the line. They can't keep throwing money at Bangkok.

'There is a fundamental difficulty that we can't get site possessions to carry out the work.'

The company's two Thai partners on the design and construct contract, Sino-Thai and Siam Syntech, believe they are about to be left in the lurch.

Bob De Sonier, assistant to the president of Sino-Thai, said the decision to suspend work was a 'bombshell'.

Like Siam Syntech, the company lent its name to the consortium because NWWI needed local partners. Neither has worked on the scheme, but they fear being blacklisted by the Thai government if NWWI pulls out.

Mr De Sonier said: 'If it goes south we could face bankruptcy and 30,000 workers could be out of work. This is not a good time to be out of work on the streets in Thailand.

'I'm 62 years old and I've worked in most countries in the world. I have never seen anything like this.'

A Siam Syntech spokesman said he believed there was a 'distinct possibility' NWWI was about to walk away.

He said: 'Basically, what they are saying is that they feel that they have been badly treated and they have had enough.

'It looks as if they will walk away and let the lawyers sort it out.'

He attacked NWWI's record on the job.

He said: 'They came over here without much experience and now they are paying the penalty. They don't understand the business of contracting and how you work to budget and keep costs down. They spent money like water.'

A Bangkok Metropolitan Authority spokesman said: 'We are trying to find out the reason they have stopped work. We believe it is their problem, not ours.'

One Thai subcontractor told Construction News: 'It's a concern to us that United Utilities appears to be prepared to dump its obligations in Thailand. Their argument with the BMA is separate to our subcontract. We have an agreement with them and they should honour it.'

He said the company had already been forced to lay off 100 staff.

He said: 'Things are tough here anyway. This just adds to it.'