Engineering issues hit Pilbara Minerals

Local miner Pilbara Minerals is threatening legal action against its former joint venture partner after discovering problems with the plant at its Tabba Tabba tantalite project, which was completed in November.

During the commissioning process, which began over Christmas, Pilbara’s operational team found areas of the plant that required modification and rectification in order to allow it to run to optimal levels.

These include the ball mill and the coarse recovery section of the pant.

“While the repairs and modifications are not considered to be major, they have prevented the plant from achieving design throughput and achieving a representative recovery rate during commissioning,” Pilbara said in a statement.

“Accordingly, the company has decided to suspend commissioning to allow an engineering assessment to be undertaken with the assistance of independent consulting engineers in order to identify the most timely and cost-effective pathway to implement the requisite changes.”

The plant was designed, constructed, installed and operated by Pilbara’s former 50 per cent joint venture partner at the project, Nagrom & Co.

Nagrom also provides services for the management and operation of the plant and ancillary facilities.

“Pilbara is moving to terminate its operating arrangements with Nagrom,” Pilbara said.

“The company is also in discussions with Nagrom regarding the cost of any modifications that will be required as a result of the current review and is considering its available legal actions in respect to the recovery of such costs from Nagrom, including but not limited to, the offset of such costs against a deferred payment conditionally payable by Pilbara as part of the acquisition of Nagrom’s interest in the former joint venture.”

Pilbara executive director Neil Biddle said the company would work to resume commissioning at Tabba Tabba as soon as possible, but as the assessment has only just begun, the company isn’t yet in a position to provide a time frame.

Pilbara shares closed 8.7 per cent lower to 26 cents each.