Orbite shares slip on plant budget blowout, construction delays
TORONTO (miningweekly.com) – Canadian alumina producer Orbite Aluminae’s TSX-listed stock on Friday slipped 18.18% to $0.72 apiece, after the company on Thursday said it would cost $20.9-million more to complete the 3 t/d second phase of its high-purity alumina (HPA) plant, in Cap-Chat, Quebec.
In its management discussion and analysis of December 2012, Orbite said the plant was expected to cost $85-million, and as at March 31, the company had already spent $74.9-million. Orbite obtained independent cost estimates to complete the project, which put the cost at $105.9-million, including $6.7-million for contingency and for critical spare parts.
The updated capital cost estimate represented the investment required to achieve the Phase 2 production capacity of 3 t/d. Orbite said a large portion of the HPA plant had been designed at a 5 t/d capacity and, as such, the requisite engineering analysis to increase the total plant throughput to 5 t/d, as well as to add a scandium and gallium separation facility, was expected to be completed during the second half of the year and the incremental capital cost estimate was expected to be reported during the first quarter of 2014.
Orbite extended the expected project timeline by six months to the end of the second quarter of 2014.
The company had also appointed Denis Arguin as VP for operations.
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