Dubai Metro plans hit by contract row

The completion of Dubai's newly opened Metro faces delays as the Japanese-led consortium building the flagship project slows work in a dispute over about $3bn worth of contract payments.

A spokesman for Obayashi Corporation, one of the five main contractors, said work on the remaining unopened stations would be slowed as a negotiating manoeuvre in payment talks with the government's transport authority.

Nikkei, a Japanese newspaper, had said that construction could be halted. The consortium includes Mitsubishi Heavy Industries, Mitsubishi Corp, Kajima Corp and Turkish company Yapi Merkezi.

However, the Roads & Transport Authority said the project remains on track, reaffirming its commitment to meeting contractual payments.

Dubai partly opened the Arab Gulf's first urban light-rail system in September and unveiled the station serving the world's tallest tower, Burj Khalifa, this week.

When opened, the cost of the project had more than doubled to $7.6bn since construction started in 2005. People familiar with the matter say the sides have been locked in arbitration talks over the additional payments. "A substantial amount of the value of the additional work is in dispute," said one.

A third of the planned 29 stations are open, with the remainder scheduled to open from February.

The bursting of Dubai's property bubble and debt woes have put pressure on the government's ability to meet outgoings.