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Tue August 11 2020

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Fluor team quits US rail project

5 May Fluor and its joint venture partners are to terminate the design-build contract for the US$5.6bn (£4.5bn) Purple Line rail project in Maryland, USA.

The joint venture has informed the project’s lead contracting and finance consortium of its intent. As a result of the termination, Fluor’s project backlog will be reduced by approximately US$1.2bn (£965m).

Fluor is the managing partner of the design-build team, Purple Line Transit Constructors, which is made up of Fluor Enterprises, Lane Construction and Traylor Bros.

The team broke ground on the project in 2017.

Fluor has now said that circumstances outside of the joint venture’s control meant there were multiple delays on the project. It said that the joint venture was unable to obtain the time and cost relief to which it is entitled from the Maryland Department of Transportation (MDOT) and Maryland Transportation Authority (MTA). “The lack of resolution on the impacts of third-party lawsuits, delayed right-of-way acquisition, and changes to regulations and third-party agreements made the joint venture’s continued participation unsustainable,” it said.

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Fluor said that the decision avoids the joint venture having to fund significant future delay and impact costs associated with completing the project.

 As provided for under the contract, the joint venture will work with MDOT and the MTA to ensure an orderly transition. The process is expected to take approximately 60 to 90 days and is reimbursable under the contract, said Fluor.

“Fluor has a long history of completing complex and diverse projects around the world,” said Carlos Hernandez, chief executive officer of Fluor. “We are disappointed that our joint venture was unable to reach a successful resolution with our client on the Purple Line project. However, Fluor will continue to combine fiscal responsibility with operational excellence when successfully executing and delivering projects for our clients across the globe.” 

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