PERTH (miningweekly.com) – Iron-ore developer Gindalbie Metals has revised its production guidance for the Karara joint venture (JV) for the December quarter, and flagged the need for further investment.

Newly appointed MD Dale Harris noted on Wednesday that the commissioning and the ramp-up of the Karara concentrator had been slower than anticipated, adding that bottlenecks, particularly relating to the tailings system, had been identified and were currently restricting plant capacity.

Karara is expected to produce between 1.3-million and 1.5-million tonnes of magnetite during the three months to December, which is slightly below the previous guidance of between 1.5-million and 2-million tonnes.

Magnetite concentrate from the Karara JV would reach about 75% of the nameplate capacity by the end of March next year, following the completion of the tailings filters refurbishment programme and the construction of a temporary tailings facility.

Gindalbie continued to investigate options to further debottleneck the plant to achieve its nameplate capacity of eight-million tonnes a year, and operational improvement work would be ongoing as part of the ramp-up and optimsiation work through 2014.

Direct shipping ore production and shipments would also continue to supplement concentrate production during 2014, and would ensure that rail and port operations were running at Phase 1 design capacity.

Harris said that the JV vehicle would have a clear plan in place by the March quarter to achieve nameplate capacity, warning shareholders that it was likely that an additional capital investment would be required.

“We have continued strong support from our partner Ansteel and our clear priority for the next 12 months will be to resolve the bottlenecks with the plant, and to bed down and optimise the Stage 1 project,” he added.

In September, Ansteel provided $230-million in funding in an effort to boost the production ramp-up. The new funding was in addition to two previous cash injections by Ansteel earlier this year, consisting of $84-million and $30-million, respectively, to cover working capital requirements and to fund previous debt.