Arabtec chief: Gazprom tower still going ahead

The company has been expanding into new markets recently.

RELATED ARTICLES: Arabtec profile: Rising from the Ashes | Arabtec receives payment from Nakheel | Arabtec CEO blames media for Aabar deal collapse

The chief executive of Arabtec Construction has declared that there have been no changes by client Gazprom Neft to plans to build a 400-metre tower in St Petersburg, Russia, despite revelations earlier this month that the plan had been scrapped without telling the emirati contractor.

Thomas Barry made the remarks yesterday regarding the tower, reported by Bloomberg, for which it has been contracted for AED10 billion. The plans for the glass and steel structure, to be situated among the baroque palaces of Russia’s second city, have attracted opposition from the United Nations cultural agency, which declares that the construction may disqualify St Petersburg as a world heritage site.

At the end of May president Dmitry Medvedev voiced his acknowledgement of UNESCO’s position and encouraged officials in St Petersburg to halt construction of the building in a letter from Kremlin advisor Sergei Prikhodko to St Petersburg Governor Valentina Matviyenko and other officials.

Story continues below

Advertisement

FEATURED COMMENT Please click here to comment on this article

The president urged "the importance of these recommendations to maintain a constructive dialogue with UNESCO and to prevent harm to Russia's reputation," in the letter, first quoted by Russian newspaper Kommersant.

Arabtec Construction won the contract in April 2008 with work due to begin last year. However, 72% of residences declared they were against the prospective building, according to a poll.

Its parent company has encountered a difficult last year following provisions it had been forced to make following the non-payment of developer Nakheel and projects stalled by developers. It has seen its margin grow in the first quarter despite a decline in profits based on its expansion into new markets.

Arabtec Holdings has lost more than a dirham per share in value since the beginning of the second quarter, closing at AED1.73 yesterday.