Production problems at that plant has already cost Orica a contract with Fortescue Metals Group and also cost the company $26 million, including costs to bring in ammonium nitrate from elsewhere to meet supply commitments.
To put that into context, Orica has won an additional 40,000t in AN supply from BHP in the Pilbara. It will likely have to source those tons from its Yarwun plant. It costs Orica $200 per tonne to transport AN to the Pilbara from Yarwun. That is an additional $8 million cost.
The 32-strong project team Orica and its joint venture operating partner Yara have put in place have ordered nine replacement heat exchangers and a replacement absorption plant.
The problem is though, the parts will not arrive until July 2019. That meant Orica's hopes o...