Bahrain-Qatar causeway on hold - sources

A long-planned $3 billion bridge linking Bahrain and Qatar has been put on hold and the project team scaled back, sources close to the project said, amid escalating costs and increased political tension.

The 40km causway linking gas exporter Qatar to the island kingdom of Bahrain was set to play a key role in improving infrastructure connections between members of the Gulf Cooperation Council (GCC), but has been beset by problems.

The project, first announced in 2001, had already been delayed in 2008 to change the project scope to include trains, and late last year the countries said work would start in the first quarter and be completed by 2015.

That fresh date came and went, however, and the project prospects were further dampened in May, when Bahrain said Qatar's coast guard shot and wounded a Bahraini fisherman who had entered Qatari waters.

"The project has seen many, many problems (and there were) also the political tensions," a source close to the project told Reuters, adding "the team has been significantly decreased."

The exact reason for the suspension of the project was not immediately clear, although Jassim Ali, a member of the economic committee of Bahrain's parliament, said "the project has been on hold for some time, but it is not cancelled," adding cost increases and financing issues had played a role.

Contractors for the project, the latest official cost estimate for which stands at $3 billion, include France's Vinci and Germany's Hochtief AG, Qatari Diar Real Estate and Consolidated Contractors Company (CCC).

A spokesman for Hochtief confirmed the construction phase had never been reached.

"We got a contract to do some planning (for the bridge), which we did, but a contract for the actual construction was never commissioned," he said.

Member countries of the GCC, a loose political and economic bloc, are trying to integrate their economies, with four of them eyeing a joint currency, but have built up little cross-border infrastructure.

The rail tracks on the causeway were to have been part of a planned train network that would connect the members of the GCC, which also include Saudi Arabia, Kuwait, Oman and the UAE. (Reuters)