Balfour Beatty (Other OTC: BAFBF - news) , the construction group that in April sounded its second profits warning in six months, has won a $120m (£78m) contract extension for the controversial $68bn bullet train project in California.
The group’s subsidiary Parsons Brinckerhoff is retaining its role managing the California High-Speed Rail project, one of the most ambitious in US history, which plans to link San Francisco and Los Angeles with a bullet train service running at speeds of more than 200mph. Journey times would be just three hours - half the current trip by car.
Parsons, which has been managing the programme since 2006, is overseeing the planning, environmental review, preliminary engineering and commissioning for the 800-mile network.
The first phase will run from Los Angeles to the San Francisco Bay Area through California’s Central Valley. Subsequent phases will connect San Diego and Sacramento.
“With funding now in place, construction of the initial segment in the Central Valley is on target to proceed this summer,” said Balfour chief executive Andrew McNaughton.
The project, and Parsons’ role, has not been without controversy. A report by the state auditor last year said the rail authority was “significantly understaffed and has struggled to oversee its contractors and subcontractors”, with one authority board member complaining that Parsons’ officials “felt that they were the authority”.
There have also been claims of favouritism and conflicts of interest following the authority’s hiring from Parsons of its new chief executive Jeff Morales.
The contract extension brings the total so far awarded to Balfour on the project to $295m.