A crunch meeting crucial to the future of Belfast's troubled Harland & Wolff shipyard is being held in London tomorrow. The meeting could determine whether the yard has any future at all.
The yard goes to arbitration tomorrow to fight for £23 million sterling (€37 million) it says it is owed as a final payment for two oil drill ships built for a US company.
The shipyard's major shareholder, Fred Olsen Energy, warned last month that the dispute had put the whole future of the yard at risk. Redundancies were said to be inevitable, but any decision was put off until after the arbitration hearing.
The US company, Global Marine, won the right in the High Court in London in early August to take the second vessel away from Harland & Wolff without paying the final instalment of £23 million. The court ordered it to pay a bond of $100 million (€111 million) and to enter arbitration this month to settle the dispute.
The wrangle centres around whether the vessel was completed on time. Harland & Wolff says it was and it was offered to Global Marine several times before the July 31st deadline, but the US company refused to accept it. For its part, Global Marine said the vessel was not completed to its satisfaction on time.
Immediately the deadline passed Global Marine went to court and won the right to take the vessel away from the yard - after putting up the bond.
As lawyers prepared to do battle Harland & Wolff said yesterday: "We believe we have a very good case and that the arbitrators will find in our favour.
"The money we are seeking is money that was in the original contract price that has already been spent on building the ships, it is not an extra payment."
The arbitration hearing is expected to last several days, but the yard is hopeful of a resolution by the end of the week.
The outcome will have a major impact on the size of a fresh round of redundancies. The yard put off a decision on its future last week pending the outcome of the fight with Global Marine.
Hundreds of more pay-offs are expected - the exact number likely to be determined by the result of the arbitration.
A further fight over another £133 million which the yard says it is owed for extra work carried out on the two ships through a change in specification demanded by Global Marine during construction is not expected until next year.
The yard has little or no current work and a £300 million contract for four ferries has yet to be firmed up.
It has also signed letters of intent to build two cruise liners worth £200 million for Luxus Holdings, but that also has not been turned into a firm order, and there have been reports that the potential customer has started discussions with Cammell Laird because of the uncertainty surrounding the future of Harland & Wolff.
Cammell Laird, which has yards on Tyneside and Merseyside in England, refused to comment.
It said it never did until the ink was dry on a contract.
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