The bombshell has rocked the Dublin-based practice, which beat 800 entrants to win the international contest to design the £21 million scheme two years ago (AJ 13.10.05).
Tourism minister Nigel Dodds confirmed that the DETI - the original competition organiser - and fellow financier the Northern Ireland Tourist Board (NITB), would no longer be bankrolling the project.
'It would not be a prudent use of taxpayers' money to proceed further, given Minister Foster's position on the private-sector planning application,' he said.
'I and the department were concerned [this] money should not be used to develop a design for a visitor centre if there was a material possibility that the centre could be built and operated by the private sector.'
It is understood the U-turn will mean around £1 million will have to be written off in wasted costs on the competition and architectural fees, and that the landowner, the National Trust, has been left angered by the decision.
The charity has publicly championed the Heneghan Peng scheme as a replacement for its original visitor centre, at the heart of Northern Ireland's only World Heritage Site, which burned down in 2000.
Trust chiefs said they had hoped the alternative proposals, filed by Seaport Investment in 2002 for a separate facility on a greenfield plot, had been forgotten about.
In a statement released to the AJ, National Trust director Hilary McGrady said she feared the privately backed scheme could have a seriously damaging impact on the world-famous coastline.
She said: 'Any development so close to the Giant's Causeway - and particularly on previously undeveloped land - would fly in the face of planning policies for the area.
'Such a decision by the minister could immediately put the World Heritage Site status at risk.'
Speaking to the AJ, Heneghan Peng founding partner Roisin Heneghan sounded shell-shocked and admitted the announcement had come out of the blue.
She said: 'We knew there was another application which has been around for years.
'But I did not know [the withdrawal of funding] would be the result of all of this.
'We were just getting all of the issues of access and traffic sorted. We have done an awful lot of work - I have no idea what happens now.'
It is understood Minister Foster was 'minded to approve' the Seaport Investment scheme and would be holding further meetings before making a formal decision.
Heneghan Peng's Giant's Causeway visitor centre hits the rocks