Bahrain has decided to withdraw a bank guarantee from Korea's Sungwon Corporation following suspension of work on the Isa Town Interchange project.

The move is in accordance with an agreement signed between the Works Ministry and the company, it was announced.

The ministry will notify the bank of the decision this week and appoint other companies to continue the work, expected to be completed in September instead of July.

'Bahrain has provided Sungwon with all financial guarantees, but the company is facing financial difficulties in Korea and Dubai and we are not ready to stop this vital project for such reasons,' Works Minister and Electricity and Water Authority head Fahmi Al Jowder said.

'We will talk to other companies this week in order to go ahead with the work, as we were granted Bahrain Tender Board's approval.

'This decision was based on an agreement signed between both parties, and the company failed to honour its commitments in continuing the work despite chances given by the government,' said the minister, citing his meeting with the company director to this effect.

'The current conditions are in our favour, with many companies able and ready to take over the project, which may be delayed by two or three months, but award of the project to another company will take more than three weeks.'-TradeArabia News Service