17/08/2015 - 15:10

AnaeCo loses operator status

17/08/2015 - 15:10

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The operator of a waste treatment plant developed in Perth’s western suburbs with support from Monadelphous Group has been told it will no longer run the plant following the disclosure of further delays and warnings of increased costs.

AnaeCo loses operator status
AnaeCo's waste treatment plant in Shenton Park.

The operator of a waste treatment plant developed in Perth’s western suburbs with support from Monadelphous Group has been told it will no longer run the plant following the disclosure of further delays and warnings of increased costs.

AnaeCo was contracted by the Western Metropolitan Regional Council to develop the Shenton Park facility, which has been hit by a series of delays and is now more than eight months behind schedule.

The Bentley-based publicly listed company issued a statement today saying the plant would remain closed for maintenance for an additional eight to 10 weeks due to engineering issues.

Last month, AnaeCo announced it had completed the biological ramp-up phase of commissioning the plant, overcoming a number of set-backs including water storage tank leaks and faulty mechanical equipment.

AnaeCo has invested $120 million in the technology used at the Shenton Park facility, which is also designed to generate energy through the production of biogas.

It has not disclosed the plant’s total costs.

In a statement today the company, in which Monadelphous Group has a 15 per cent stake, warned further costs and delays at the plant were possible due to operational issues out of its control.

The owners of the facility DiCOM have told AnaeCo it will no longer operate the plant, once it gets it to “practical completion” stage.

AnaeCo managing director David A Lymburn said not knowing who would take over the plant's operations was creating inefficiencies and could cause further delays.

He warned the uncertainty could also affect the start date of performance trials aimed at increasing the amount and type of waste the plant can process.

Mr Lymburn said AneaCo had incurred additional costs stemming from the delay in naming a new operator.

“Because of this ... (we) will be seeking to recover costs where possible,” he said in a statement.

Mr Lymburn said AnaeCo had been further affected by the plant’s users, which had failed to agree to final terms for payment of gate fees for waste to be delivered to the facility.

“While these operational matters themselves are not the drivers of the commencement of performance trials, until resolved they contribute to uncertainty and the potential for delay,” he said.

Changes in how the City of Stirling collects garbage from residents is also expected to affect the plant’s performance, with trials due to consider how an increase in waste from the City of Stirling and its recent change to a three-bin system will work.

The plant, which was originally contracted to treat 60 per cent of its waste from the local western suburbs members of the WMRC and 40 per cent of its waste from the City of Stirling, will now be supplied with 75 per cent of its waste from the City of Stirling and only a quarter of its waste from the WMRC members.

“All of this means the composition of waste is predicted to change quite significantly relative to the basis of the original design,” Mr Lymburn said, referring to the contract initially signed in December 2010.

Anaeco shares dropped slightly to .1 cents today. 

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