Contractor says miner owes $1 million in payments

A Geraldton-based electrical company says it is owed more than a million dollars over work carried out almost three months ago at a Mid West mine site.

It is believed up to four other contracted companies are owed amounts ranging from tens of thousands of dollars to about $2 million.

Sources close to the mining company have told the Guardian between 135 and 175 creditors, mostly Perth-based, were owed "quite a lot of money".

S&K Electrical managing director Steve Villier said Top Iron had breached its contract in withholding payments for work at the Mummaloo iron ore project near Extension Hill.

The West Perth-based miner has completed the first stage of its project and plans to begin production later this year.

“We are owed well over $1 million and by the end of the month we will have waited 120 days,” Mr Villier said.

“It has just about sent us to the wall. We’ll get by, but it just makes it hard.

“We’ll survive, but it’s gonna hurt.”

Mr Villier said he had tried on numerous occasions in discussions with Top Iron to establish when payment would be made, but was unable to secure a time frame.

Top Iron chief financial officer Michael van Uffelen said he could not comment on specific contracts because of confidentiality agreements, but it was not uncommon to have contractual disputes with suppliers.

“We do not acknowledge delays with any of our contracts,” he said.

“We do have (contractual disputes) with a number of suppliers.

“Top Iron does have capacity to meet its obligations. Any lack of payment is not due to lack of capacity but to contractual disputes.

“If work is not up to standard, deliveries are late … there are myriad reasons for a contract not being paid, but financial capacity is not the cause.

“We are able to pay and will fulfil our obligations in terms of payment for work done.

“We are in dispute and until the dispute is resolved payment can’t be released.

“That’s the normal course of business.”

Mr Villier said the only contractual dispute he was aware of was that his company had not been paid.

“At no stage where were questioned by the client about the quality of our work,” he said.

Top Iron chief executive officer Bruce Richardson said in a statement yesterday all works undertaken by contractors were subject to the usual variation, quality control and rectification process.

“These are being worked through as a matter of course with the relevant contractors, and Top Iron has the capacity to meet contractual obligations,” he said.

“The project has been on foot for several years and has provided work for local businesses and their employees.”

Creditors negatively affected by delays in payments are invited to contact Lewis Freer on (08)9956 1038 or Shannon Beven (08) 9956 1033.