Works on the A5/N2 Road is jointly funded by the British and Irish Governments, and is the main link between Dublin and the North West.
There was speculation funding for the project could be in doubt as the government seeks 100 million euro in saving to cover the cost overrun of the National Children’s Hospital.
The upgrade is seen as essential for improved access and safety.
Following legal challenges, work on the project is expected to start towards the end of this year.
Speaking in the Dail this afternoon, Leo Varadkar blamed the political impasse in the North for his decision to pull the 27 million euro in funding.
West Tyrone MLA Daniel McCrossan disagrees: