South Australian construction company OTM has been placed into liquidation.
The company, based in the Clare Valley, was subcontracted to complete work on the two overtaking lanes south of Tumby Bay and the lane on Flinders Highway.
The company was wound up on September 21 and appointed Mark Lieberenz of Heard Phillips Lieberenz (HPL) as liquidator.
"Unfortunately due to financial circumstances we are not able to trade the business," said Mr Lieberenz.
"Prior to my appointment they had pulled employees from their sites on Friday."
Mr Lieberenz said as liquidators they were now trying to minimise the stress and impact on employees, and were in the process of securing plants and equipment for auction to be able to pay secured creditors and securing records and inventory.
"All creditors will get some formal documentation from us next week," he said.
He invited creditors who had concerns or question to get in touch with the company.
Member for Flinders Peter Treloar said he had sought a briefing with Transport Minister Corey Wingard as soon as he became aware of the liquidation.
"The Departmental Alliance formed to oversee the PW2PA works...is making arrangements to take control of the overtaking lane projects and complete the works using labour from OTM," he said.
Chief executive officer of Regional Development Australia Eyre Peninsula Dion Dorward said OTM were subcontracted by tier one contractor CPB contractors.
"OTM was contracted by CPB...OTM have been placed into liquidation," he said.
"The project appeared to be one with problems along the way, and there was a lot of dissatisfaction among local contractors.
"A number of local businesses have been impacted locally, and some are owed significant amounts of money.
"We encourage affected businesses to contact us, to contact the RDAEP.
"We're collating who is owed what and look to work collectively to ensure businesses are paid."
Mr Dorward said he had met the liquidators and some affected businesses, and the RDAEP was now planning a meeting in Tumby Bay next Thursday for creditors.
"We want to get everyone in a room and make sure everyone is alright, their mental health and wellbeing, and also have a collective conversation about where to from here," he said.
Mr Dorward said he had sought a briefing on the situation, and that both federal and state members Rowan Ramsey and Peter Treloar were aware of the unfolding situation.
"The minister for transport and the premier are also very aware of this and concerned, and I've got every confidence they will support local businesses where they can," he said.
Mr Dorward said the unfinished stretches of road were also of particular concern.
"Most definitely that road has to be finished and we're all thinking, it's pretty close to harvest," he said.
"There are lots of people on the road and these roadworks will cause safety issues if not finished shortly."
He said he expected CPB will appoint another contractor to finish the project.
Anthony Cave from Cave Quarries said he was owed $350,000 and was "very disappointed" about the situation.
"It's very sad, I'm gutted actually," he said.
"I have signed with the main company (CPB) to continue work...but I owe others' money too.
"I'm hoping the government will step in and do something about it.
"The work is still there, it's just there was a very big cheque that I was relying on that hasn't come through.
"It's got to be finished, and before harvest."
Mr Cave said many other businesses were impacted, including accommodation businesses and he said it would have other knock-on affects.
The installation of the overtaking lanes are part of the federal and state government's $32 million commitment following the closure of the rail line, and is overseen by the Port Wakefield to Port Augusta (PW2PA) alliance between CPB, the transport and infrastructure department, and Aurecon and GHD.
A Department for Infrastructure and Transport spokesperson said they had received confirmation of the voluntary liquidation.
"OTM is a subcontractor to the PW2PA Alliance that is undertaking part of the civil works on three overtaking lanes in the Lower Eyre Peninsula," they said.
"The Department and PW2PA Alliance are working to assess what, if any, impact this will have on completing these important works."
CPB have been contacted for comment.