Port operator Luka Koper said on Tuesday it would not renew the contract with the Italian dredging company Costruzioni generali Xodo.

The company was commissioned to dredge the seabed along the container terminal to a depth of 14 metres to allow the port to handle bigger container ships.

But it completed less than a tenth of the work in the designated time, in what Luka Koper said was an "unjustified and drastic delay".

Luka Koper will now hire a new contractor to complete the works by August since the port expects bigger ships to start docking in autumn.

The news comes after bad spring weather delayed the dredging of the access canal to the container terminal.

Work is now under way there and is set to be completed by February 2015.

The dredging is a part of a EUR 78m expansion project that also involves new storage area, which will increase the port's current capacity to 980,000 container units (TEUs) from 750,000 per year.

The entire multi-phase project will be completed by 2018.