Australian junior salt and sulfate of potash (SOP) producer BCI Minerals Ltd. has flagged a A$500-million (approximately US$331 million at current exchange rates) cost hike at its Mardie salt and potash project on the Pilbara coast of Western Australia, and also warned of delays to first production and sales.
BCI in a June 20 statement revealed the results of its design and cost review, which has updated the cost estimate for Mardie to A$1.62 billion, with a base estimate of A$1.42 billion and a contingency of A$208 million. This marks a significant increase over the A$913 million cost previously estimated for the project.
BCI Managing Director David Boshoff said in a June 20 presentation that the design review had identified cost pressures in a number of areas, particularly the civil works, which impacted the cost of the ponds, roads, transfer stations, crystallisers, and a jetty pad.
The review process has retained the production level of 140,000 mt/y of SOP and 5.35 million mt/y of high purity salt (GM July 15, 2022), but BCI said the timing has been delayed for the first shipments. First SOP is now targeted for mid-2027 instead of the initial target of the first quarter of 2026, while first salt is now targeted for mid-2026 rather than the first quarter of 2024.
The operation is ultimately planned to include a 100 km2 evaporation pond and crystallization system, two processing plants, and a new export facility. BCI on June 27 reported that it had executed a term sheet with Japan’s Itochu for a salt offtake agreement from Mardie.