Galaxy Resources shares dipped today after it revealed a $27 million cost and schedule blowout for its lithium carbonate processing plant in Jiangsu, China.
Galaxy announced today that construction and fabrication labour shortages had resulted in a cost blow out to $99.8 million for the plant, up from a previous estimate of $72.5 million.
Although it said the plant was 76 per cent complete, Galaxy's stock dropped 4.3 per cent to 66 cents.
The company said commissioning of the plant would occur over the next five months.
"The new schedule indicates that the back half of the Jiangsu plant - which includes purification, drying, micronising and bagging will be completed with commissioning to commence during Q3 2011," Galaxy said in a statement.
"The front half of the plant - which includes calcination, sulphation, leaching and precipitation - is expected to be completed with commissioning to commence during Q4 2011."
Galaxy managing director Iggy Tan said there was no need for any further capital raising to accommodate the cost blowout.
"We are on a clear path to completion and Galaxy will continue to work hard to ensure the Jiangsu project is completed within the revised timeframe and budget," he said.
