The mechanical problem is the main pump impeller that keeps wearing out (much faster thane expected) . They have got a new one plus two spares. They want to work out why it is wearing out so that:
1 they don't have to stop and keep replacing it .
2 impellers are wear resisitant NI ckel cobalt steel so costs plenty .
However even if they take quite a while to figure out how to fix it. They will use the ones onsite to run the wet concentrator (plant) which produces concentrate (free from quartz) that is then separated in the dry plant.
So whilst the mechanical problem is a nuicance and costly.
1 The wet plant is probably still operable at say 90% avaiability.
2 The operation in conjuction with the Norway operation is still profitable (though dependent on Ti02 price.)
Note: the shortfall in ilmentite cause by the lower production helps improvethe TiO2 supply demand balance ie. props up prices.
In a nutshell in my opinion the price fall way overdoes the extent of the problem. Obviously Alan Gray think so.
MDL Price at posting:
$1.40 Sentiment: Buy Disclosure: Held
