The Singapore government announced mid November that it would not bail out the Marina Bay Sands resort should its cash-strapped parent, casino operator Las Vegas Sands, go bust.

Senior Minister of State for Trade and Industry, S. Iswaran said: “There was no request for a Government bailout for Marina Bay Sands and neither does the Government intend to do one.

“I think it has always been a commercial project and the solutions to the challenges posed by the current economic environment and financial market situation really lie in the commercial sector as well.”

On the possibility of a role for a government-linked company, he said these were commercial enterprises and would have to make their own decisions on whether an investment makes sense, adding that “it’s not for the government to tell them what to do”.

Prior to the government’s announcement, the casino operator said it had secured US$2.14 billion (approximately S$3.22 billion) in capital funding commitments. Chief executive officer Sheldon Adelson declared the Singapore project the company’s number one priority, while suspending construction of projects in Macau and Las Vegas.

Iswaran welcomed news of extra capital and the company’s commitment to complete the Marina Bay project as an “important assurance” but questions linger over the project’s timeline and when the integrated resort (IR) will open.

Las Vegas Sands’ executive vice president Bradley Stone said that the casino, two of the three hotel towers, most of the convention space and a portion of the retail mall will open by the end of next year. Meanwhile, other facilities will open in early 2010. The original plan was to open the whole complex at the same time next year.

Iswaran said Las Vegas Sands had requested to modify the timeline but so far, the Singapore Tourism Board (STB) “has not agreed to any of these variations”. The project details, which include possible penalties for delays, are laid out in a development agreement signed by Sands and the STB.

The STB said it had various options under the agreement, the ultimate being the right to “step in and resume possession of the land, the IR and any other structure on the land, and deal with them as STB sees fit” if the project wound up or if a receiver is appointed over its assets.

According to Iswaran, there is a need to look at what actually are the specific proposals and requests before a decision is made on whether to impose penalties for delays.

Knight Frank’s director of consultancy and research Nicholas Mak noted that the clause allowing the government to step in and take over the land and whatever is on it should the project fail is not unusual.