A dispute between South Dublin County Council, Eircom and Wyethcentres on the cost the council wishes to charge Eircom for access to ducting

The development of a $1 billion (€1.01 billion) biotechnology campus in Dublin by US drug firm Wyeth Medica is being held up because of a dispute over the cost of telecommunications services at the site.

The dispute between South Dublin County Council, Eircom and Wyeth centres on the cost of access to ducting - owned by the council - through which telecoms firms run the cabling for internet and telephone services to the campus.

IDA Ireland and the Office of the Director of Telecommunications Regulation are monitoring the dispute amid concern that it is undermining the Republic's reputation as an investment location.

The issue has also raised concern within Government about the ability and willingness of local authorities to develop and manage telecommunications policy.

It is believed South Dublin County Council wants to charge Eircom up to €54 per metre for the use of ducting to carry its fibre network into the site.

This is significantly more than prices charged at other business parks in Dublin and has caused Eircom to pass on the costs to the drug manufacturer, which is building the largest biotechnology campus in Europe.

Sources told The Irish Times yesterday that Wyeth had rejected Eircom's proposed pricing because it passed on the ducting costs to the biotechnology firm. However, this is despite Wyeth's insistence that it requires the telecoms service within a matter of weeks.

Talks between the principal players in the dispute are ongoing but there is no sign yet of a resolution, the sources said.

The Wyeth plant in Clondalkin has been billed by the Government as the biggest biotechnology campus in Europe and will represent an investment of $1 billion.

Although the campus will not be in full production until 2005, more than 300 staff have already been recruited for the project, which will eventually employ 1,300.

An IDA Ireland spokesman said the agency was aware of the issue and it needed urgent resolution.

"This issue of the cost of telecoms is not just a Wyeth issue but is happening all over the State," the spokesman added.

A similar problem over the cost of telecoms ducting held up development at Citywest business park more than a year ago.

This was finally settled after negotiations between a number of telecoms firms, park developers and development agencies.

A Wyeth spokesman said yesterday the firm had no comment to make and that it was an issue for South Dublin County Council and Eircom.

Eircom was doing everything it possibly could to provide a service to Wyeth but unusually high third-party costs were making the provision of these services difficult, according to a spokesman for the telecoms company.

South Dublin County Council would not comment on the issue and described the issue as "commercially sensitive".

The current dispute, which is impacting on one of the Republic's biggest ever inward investment projects, has raised questions over the willingness and ability of local authorities to manage effective telecommunications programmes.

This is a vital issue as councils will be a key partner in the Government's recently announced plan to develop State-wide telecoms networks at a cost of €300 million to the taxpayer.