MZI Resources’ push to increase its mineral sands output from its Western Australian operations has caused it a few headaches.

The company (ASX:MZI) has been working to increase the capacity of its Keysbrook and Picton operations to 5.25 million tonnes per annum (Mtpa) from 4Mtpa.

Disruptions and challenges during the commissioning process delayed targeted performance levels, particularly leucoxene recovery rates, by about two months.

Leucoxene is a fine, granular alteration product of titanium minerals. Although it is not a recognised mineral species, the name leucoxene has been applied to products with a TiO2 titanium content ranging from 70 per cent to 93 per cent

MZI had been aiming to reach “steady-state” production in mid-April, but did not reach that point until mid-June.

Managing director Martin Purvis said the commissioning process had been “far more challenging than expected”.

MZI Resources (ASX:MZI) shares over the past year.
MZI Resources (ASX:MZI) shares over the past year.

“Whilst delays in lifting production in the first half of calendar year 2018 have been disappointing, recent improvements in performance at both Keysbrook and Picton, combined with improving fundamentals in the mineral sands market, bode well for the additional saleable products now entering the MZI pipeline,” he said.

As a result of the delays, MZI has to seek a waiver from Resource Capital Funds VI L.P. to be able to drawdown the second tranche of its $US7.5 million ($10.1 million) loan.

However, MZI still expects to meet its previous total saleable production target of 70,000 to 80,000 tonnes for the 2018 financial year.

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