Alinta staff have been banned by management from purchasing machinery parts crucial to the company's operation as speculation grows that its parent Babcock and Brown Power is on the verge of collapse.
An Alinta employee, who declined to be named, told thewest.com.au today accounts had been frozen at the company and staff had been told not to purchase anything.
"We can't order critical parts, we can't even buy a spanner," he said.
The employee said many staff were busy getting their resume up to date.
Shares in Babcock and Brown Power were placed in a trading halt last week and suspended on Friday while the company continues negotiations with the Woodside-operated North West Shelf Venture over how much the utility should pay for gas.
BBP has been in dispute with the group over gas prices for the past year.
But a ruling by independent arbiter retired High Court judge Michael McHugh last week is rumoured to be potentially ruinous for Alinta.
It is likely Alinta may have to pay at least twice as much for gas compared to the old regime, further eroding its profit margins and ability to service the BBP debt load.
BBP is trying to refinance a $2.6 billion syndicated loan facility, taken on as part of the Babcock & Brown consortium's debt-fuelled $7.9 billion takeover of Alinta two years ago.
The Alinta takeover occurred just before the onset of the global financial crisis that sparked Babcock & Brown's collapse, leaving satellites like BBP to teeter on the brink with excessive debt.
It is understood BBP's finances are so dire that its interest cover is close to, if not below, one-times.
Premier Colin Barnett has already ruled out bailing out or buying back Alinta.
On Saturday, The West Australian reported a group of former Alinta senior executives were drawing up plans to buy the WA utility as soon as the contentious gas arbitration issue was settled.
The trio - Alinta's ex-group manager of acquisitions and strategy Rod Evans, group manager investor relations Shaun Duffy and group manager treasury David De Loub - have remained tight-lipped on details of their proposal, code-named Lazarus, and who they would install to run the utility if they were successful.
BBP is expected to make an announcement before the beginning of ASX trading on Thursday.
