Spanish firm Sacyr denies halting work on Panama Canal

The Spanish building company leading the expansion project on the Panama Canal has denied that work at the waterway has been halted.

The president of Sacyr, Manuel Manrique, said no date had been set for construction work to stop.

The Panama Canal Authority and the building companies involved are engaged in a dispute over who should foot $1.6bn (£1bn) in extra costs.

The Panama Canal is one of the world's most important shipping routes.

The consortium says 10,000 jobs are at risk, but the canal's authority says it will not "yield to blackmail".

Earlier today, the Panama Canal Authority (ACP) announced that talks with the Spanish-led consortium behind the project had broken down.

The Canal Authority also said that work had been halted at the site.

Mr Manrique admitted that work may eventually stop, if the building companies run out of cash, but said no such decision had been taken by the consortium.

"There is still room for negotiation with the ACP," Mr Manrique told the Spanish radio network Cadena Ser.

"This project, like many big projects, has unforeseen costs. We want an arbitration court to decide who will pay for that," he added.

The consortium is made up of Spain's Sacyr, Impregilo of Italy, Belgian firm Jan De Nul and Constructora Urbana, a Panamanian firm.