Balfour Beatty warns it may pull out of Turkish dam project

Click to follow

Balfour Beatty, the construction group, raised the stakes yesterday in the debate over official British involvement with Turkey's Ilisu Dam project, saying it would pull out of the venture if export aid is not granted.

Balfour Beatty, the construction group, raised the stakes yesterday in the debate over official British involvement with Turkey's Ilisu Dam project, saying it would pull out of the venture if export aid is not granted.

The $2.1bn project has attracted strong criticism from two House of Commons select committees, and also from environmental and human rights groups who say the dam would anger downstream states, Syria and Iraq; endanger archaeological sites; and displace thousands of people without adequate compensation or resettlement.

The case is seen by many exporters and pressure groups as critical for the working of the reformed Export Credit Guarantee Department, which under new guidelines must take account of human rights and environmental concerns when assessing requests.

Balfour Beatty, which is involved with Ilisu through a Swiss-led consortium, values its share of the project at "several hundred million dollars".

Mike Welton, Balfour Beatty chief executive, said yesterday that if Stephen Byers, the Secretary of State for Trade and Industry, did not approve the export guarantees, his company would end its involvement with Ilisu.

Last year, Mr Byers said he was "minded" to approve the support, sparking a wave of criticism.

Yesterday, a DTI spokesman said that assistance would be approved only if the Turkish government provided assurances on resettlement, preserving important archaeological sites and guaranteeing the supply of river water to Syria and to Iraq.

Mr Welton's comments came as Balfour Beatty unveiled a rise in net income to £35m from a comparable £12m in the six months to 1 July.

Mr Welton said the company has net cash reserves of £135m and was on the look-out for acquisitions to boost its presence in railway-related work, and in the United States.

Balfour Beatty shares ended 3.5p higher at 111.5p.

Comments