Spanish contractor sues Qatar charity after deal falls through

The Qatar Foundation, a charity set up to promote education and ethics, is facing legal action from Spanish contractor Obrascón Huarte Lain (OHL). 

A joint venture between OHL and US firm Contrack International lost its role on the unfinished $2.3bn Sidra Medical and Research Centre project last week. OHL and its partner won the work in 2008, and the scheme was originally scheduled for completion by 2011.

Jose Maria del Cuvillo Peman, OHL’s vice-secretary of the board of directors, said in a letter to the London Stock Exchange that it was fired from the project owing to the "pace of the works and delivery deadlines".

OHL said: "According to the current estimations, the degree of completion in the execution of the contract is around 95%, with the final delivery to the client being scheduled in the first quarter of 2015.

"OHL considers that the reasons given by the client lack any legitimate grounds, and consequently intends to activate through the consortium the mechanisms set out in the contract to claim before the International Chamber of Commerce based in London, through arbitration, the effective protection of its interests."

The Qatar Foundation has not given any official statement regarding the dispute. OHL is listed on the stock exchange and so has to issue a statement on any event that is likely to affect its profitability.

The Qatar Foundation has recruited a new joint venture to complete the medical centre, this one between Qatari contractor Midmac and Jordan’s CCC. 

The joint venture issued a statement saying, "Midmac is one of Qatar’s largest contracting organisations, while CCC is one of the biggest and most well-regarded engineering and construction companies in the Middle East region. Both companies have proven track records in delivering vast and challenging projects".

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