The Infrastructure Department will take over the construction of the new £75 million sewage works at Bellozanne.
It comes after the project's main contractor, NMCN plc, went into administration.
The Infrastructure Minister says his department has been monitoring NMCN's commercial status for over a year.
Deputy Kevin Lewis says after considering the options, IHE has terminated its previous contract and plans on completing the building work itself.
He says the department is committed to delivering the project on time and on budget:
"My department has been working closely with its advisors and project stakeholders to consider its options in relation to both the termination of the contract and completing the outstanding work. IHE is committed to achieving the project and delivering this vital infrastructure asset for the island of Jersey within expected budgets, quality, and timescales.
"My department now intends to take the necessary steps to act as the principal contractor for the project and will be looking to engage with the supply chain."
Ballet based on Jersey legend comes to the island
New vibrant town workspace brings together desks with disco balls
Cocaine found hidden in parcel of candles
Manifesto booklets delivered to Jersey homes
Fertility charity platforms mental health help
Ombudsman issues advice about mis-sold car loans
'Music Muratti' for young musicians in the Channel Islands
Jersey celebrates 81 years of Liberation
