HLG Contracting is no longer working on the contract to build two sections of the Expo Village residential development at the Expo 2020 site in Dubai.

The local/Australian contractor said it was awarded a AED619m ($169m) contract for the construction of the parcels 10 and 11 of the Expo Village in July. According to sources close to the project, HLG Contracting stopped working on the contract because it could not provide a performance bond. A performance bond is given to a project client by a contractor to guarantee its performance on a project.

The scheme involves the construction of five 16-storey towers. Three of the towers are connected by a three-storey podium, and the other two towers are joined by another three-storey podium. The development has a total built-up area of 155,000 square metres.

It is understood that the project client, Dubai World Trade Centre, is now in talks with Beijing-based China State Construction Engineering Corporation to take over the project.

Construction is due to be completed by June 2019 ahead of the start of the Expo 2020 event which starts in October 2020.

Both HLG Contracting and its Australian shareholder Cimic declined to comment.