The future of pallet manufacturer Pinetec and 110 of its employees is in serious doubt after receivers today said the company will last only four weeks unless a buyer is found.
Receivers PricewaterhouseCoopers said it has notified employees of the circumstances, which arose after an explosion at Verve Energy's Muja power station in Collie in February last year.
Pinetec was supplying biomass material to the Muja power station, however the material is believed to have caused the February explosion, causing Verve to cease the use of the material.
An investigation to establish the source of the explosion is ongoing.
As a result of the explosion, Pinetec incurred a reduction in revenue from Verve.
Pinetec went into receivership in June 2008 but has been trading despite significant losses in an effort to find a buyer.
"We are in negotiations with several interested parties. If a sale were to occur employees would be retained on a casual basis until settlement," PwC partner Derrick Vickers said.
"If a sale is not affected in the next four weeks the mill will close.
"The closure is also likely to affect many large WA manufacturers that may need to source alternative pallet supplies from the east coast or overseas."