The Panama Canal authority and a consortium working on widening the waterway have given themselves until February 1 to resolve a bitter financial dispute that threatens the project, the consortium said Thursday.

The negotiations are aimed at "a long-term solution" to complete the project, which has been plagued with delays and disagreements over extra costs and slow progress.

The consortium Grupo Unidos por el Canal (GUPC), led by Spanish builder Sacyr, said it and the Panama Canal Authority (ACP) had decided to "continue dialogue, in principle until February 1, to reach a long-term solution."

The move comes after the consortium presented a proposal Tuesday that Panamanian officials said could provide a way out of the bitter dispute.

Since the beginning of the year, work by GUPC has slowed, as ACP and GUPC haggle over cost overruns that the consortium estimates at $1.6 billion (1.2 million euros).

GUPC, which has threatened to shut down the project if it is not paid, accuses the canal authority of providing bad information on the site's geology.

After visiting the site Wednesday, Panama's Minister of Labor Alma Cortes told reporters that work was paralyzed.

"It's as if they abandoned work after a tsunami," she said.

GUPC, which includes Impreglio of Italy, Belgium's Jan de Nul and Constructora Urbana of Panama, has said it would be open to sharing the bill for the overruns.

But the ACP and Panama authorities insist on finding a solution consistent with the terms of the contract, threatening to break the contract if work continues slowly.

On Wednesday, Panama's Minister of Economy and Finances Frank De Lima said from Davos, Switzerland that "the canal will be finished during 2015, with or without" GUPC.

The overall canal upgrade was supposed to cost $5.2 billion, including GUPC's $3.2 billion contract to build a third set of locks for the century-old canal, which currently welcomes ships that carry up to 5,000 containers.

The project aims to make the 80 kilometer (50 mile) waterway, which handles five percent of global maritime trade, big enough to handle new cargo ships that can carry 12,000 containers.

Work on the canal began in 2009 with the goal of being completed by 2014, which coincides with the waterway's 100th birthday.

But completion was pushed back to 2015 after a first disagreement between the canal authority and GUPC over cement quality.