The Panama Canal Authority, or ACP, said Tuesday that it has presented a "proposal that could be a long-term solution" to the conflict that threatens to shut down at any moment the work of expanding the interocean waterway, though he gave no details.

"We're still discussing separately among ourselves and jointly" the proposal "that has brought the parties to the negotiating table," ACP administrator Jorge Quijano said.

The announcement was made during a recess of the meeting that began Tuesday morning between the authority, the Grupo Unidos por el Canal consortium, or GUPC, led by Spain's Sacyr and Italy's Impregilo, and the Zurich Insurance Group, guarantor of the project with a deposit of $600 million.

As for the time it could take to evaluate the proposition to see whether it is acceptable to all parties, Quijano said that above all it will depend on the consortium, because the ACP made it clear that it would only accept a solution that is "part of the contract."

"The Canal must remain within the contract and I believe that condition has been accepted both by Zurich and by GUPC. So we're working on a proposal between the two of them that could be satisfactory within our legal terms," Quijano said.

The administrator also said that the GUPC has just notified the ACP in a letter that it has extended until Jan. 31 the total suspension of the construction works, after saying on Dec. 30 that it would paralyze them in three weeks, on Jan. 20.

The parties began talks earlier this month at the urging of Spanish Development Minister Ana Pastor, who traveled to Panama as part of Madrid's efforts to mediate the dispute.

The ACP said on Jan. 7 it would advance the GUPC $100 million and give the consortium a grace period of two months to repay a previous advance of $83 million, provided the contractors also put up $100 million and withdraw their threat to suspend work.

Quijano told Panamanian lawmakers the following day that that proposal was the only "reasonable offer" on the table.

The consortium countered by proposing the ACP fork out an additional advance of $400 million while also pledging to contribute $100 million of its own funds to keep the project running.

The contract for the locks, which is the centerpiece of a $5.25 billion canal expansion, was awarded to GUPC in 2009 and calls for the ACP to pay the consortium a total of $3.12 billion.

So far, the ACP has paid GUPC $2.83 billion, including repayable advances, plus an additional $180 million for cost overruns.

The Panama Canal, which was designed in 1904 for ships with a 267-meter (875-foot) length and 28-meter (92-foot) beam, is too small to handle modern ships that are three times as big, making a third set of locks essential. EFE