Mardie project faces delays

Shares in BCI Minerals dropped 11 per cent after pushing back its targeted date for first salt shipments, with the extent of cost hikes on the billion-dollar project still to be confirmed.

The salt and potash developer issued an update to the ASX advising that plans to have first salt on ship from the Mardie project by the end of FY24 were likely to be extended to the second half of FY25.

The company also flagged that some aspects of the project would be changed in order to comply with third-party approvals and in preparation for extreme weather events.

BCI has previously warned of significant cost escalations during construction of the solar salt project, mostly due to inflation, and is currently undertaking a review to determine where costs might be saved.

Initial cost estimates for the project were around $1.2 billion, with a revised figure expected once the review is completed.

Main construction at the Karratha project started in March and officially is estimated to produce over 5 million tonnes per annum of salt and 140,000 tonnes per annum of potash once operational.

“BCI continues to assess further value engineering opportunities, conduct reviews of design assumptions and advance design maturity of all packages to reduce risk and partially offset the cost increases,” BCI said in a statement.

Further updates are expected by the end of July.

BCI Minerals shares closed the day down 9.43 per cent to trade at 24 cents.