Contractor claims Japanese partner has not paid it 鈥榝or several months鈥

Laing O鈥橰ourke has withdrawn 800 of its workers from a huge gas station job in northern Australia over a pay dispute.

The contractor is building four cryogenic tanks at the LNG Tanks Project in Darwin for lead construction partner Japanese firm KHI, under a contract signed in 2012. Work began on site mid-2013 and is in its final stages.

In a statement Laing O鈥橰ourke claimed it had not been paid by KHI 鈥渇or several months鈥.

The firm said it took the decision to 鈥渄emobilise鈥 its workers after talks with KHI over recent weeks - including a meeting in Tokyo last Thursday - 鈥渇ailed to produce a satisfactory outcome鈥.

The firm added: 鈥淟aing O鈥橰ourke notified the parties that it would take action to protect itself from the consequences of KHI鈥檚 conduct, unless urgent measures to rectify the situation occurred. KHI has declined to take those necessary steps.

鈥淟aing O鈥橰ourke鈥檚 priority is to now attempt to redeploy staff to the company鈥檚 significant national pipeline of projects whilst also assisting sub-contractors impacted by this demobilisation.鈥

Laing O鈥橰ourke - which has worked in Darwin for nearly 50 years - said it had ensured all staff, suppliers and contractors were paid during the period of dispute. The company鈥檚 other project on the Ichthys site, which is direct for the client JKC, is unaffected.

KHI has been contacted for comment.

The dispute comes at a troubled time for Laing O鈥橰ourke, which late last year posted an overall 拢246m pre-tax loss for its last financial year to March 2016.

The firm confirmed it made heavy losses of 拢93m over the year on its troubled PFI hospital job in Canada, the Centre Hospitalier de l鈥橴niversit茅 de Montr茅al.

Elsewhere, Laing O鈥橰ourke reported 拢43m of losses on three jobs carried out by its Design for Manufacture and Assembly (DfMA) business 鈥 the offsite arm of the company - and 拢23m of restructuring costs.

But founder and chief executive Ray O鈥橰ourke said the firm was set to return to profit in the current financial year and also set out plans for the firm to become a 拢4bn-turnover business within four years.