Efforts have been made to smooth tensions between a junior miner and Andrew Forrest's Wyloo Metals over the financing of a rare earths project in Western Australia.
However, there are concerns the "unsightly" and "public" rift between Hastings Technology Metals and Wyloo will be damaging and could deter future investors.
Hastings Technology Metals has plans to build the $949 million Yangibana rare earths and niobium mine 1,144 kilometres north of Perth.
Processed rare earth materials from Yangibana mine, which are rare to find alongside niobium. (ABC Rural: Sophia Alston)
Mr Forrest's Wyloo Metals provided financial backing for the project in the form of a $150 million loan.
But last week Wyloo issued Hastings with a notice of event of default amid concerns Hastings would not be able to repay the loan.
Hastings shares dipped to a six-month low following the announcement.
Days later, Wyloo retracted the notice and said it would resume discussions with the company over the loan in advance of it maturing next year.
Hastings attempted to downplay the situation, labelling it a "technicality".
But it has sparked further questions about the company's financial position and the viability of the Yangibana project.
Deals going public 'unusual'
Business analyst Tim Treadgold said financial disputes in the mining industry usually happened behind closed doors.
"This isn't normal in the industry, it's very unusual to see this sort of thing go public. It's pretty unsightly," he said.
"It would rattle potential bankers, it would rattle potential government supporters.
"This [retraction] is a short-term solution to a complex financial problem. They've called a ceasefire."
Construction of the Yangibana project is set to begin in the second quarter of 2025 for full production by 2027, but the company still needs to secure $320 million to build it.
Business analyst Tim Treadgold says "you wouldn't conduct this sort of affair in the public eye". ( ABC News: Angela Ho )
The project has already faced cost blowouts and construction delays.
Mr Treadgold said Hastings' most recent quarterly cash flow report showed as of September 30 it had $9.9 million available in the bank.
"That's not a show stopper but it's certainly an indication of how tight things are at the moment," he said.
"While everyone's backed off, the issue is still there.
"And the issue is this — where's the money to build this project?"
Hastings has talked up the potential for widespread economic benefits of the project, estimating it will bring $1.33 billion in net public benefits for the Greater Gascoyne over its 17-year mine life.
Carnarvon Shire president Eddie Smith says Hastings last provided an update on the progress of construction in May. (ABC Pilbara: Rosemary Murphy)
Carnarvon Shire president Eddie Smith said he had not heard from Hastings Technology Metals since earlier in the year.
"Last I heard they were beavering away at trying to achieve the required funding to get the project up and happening," he said.
"Nothing as far as I can tell has changed from that."
Project will go ahead
Corporate general manager for Hastings, Vince Catania, said the Gascoyne could be assured the project will go ahead next year.
"We've spent $156 million at the site for the anti burner mine, with all the early works that have been undertaken, which puts the company in a very good position," he said.
"We've got all the approvals needed to be able to commence construction and go into production."
Hastings' Vince Catania says Wyloo is supportive of the Yangibana project. (Supplied: Hastings Technology Metals)
Hastings still has several options for investment on the table, including $220 million funded via the federal government's Northern Australian Infrastructure Facility (NAIF).
"The company is in discussions with NAIF and the federal government to see if it's an opportunity to be able to utilise government loans for this project," Mr Catania said.
"The company will choose the best option for the shareholders and the best way forward in the funds needed to ensure the project is viable."
A rare earth proposed to be mined at Yangibana, niobium, is used in alloys for jet engines and rockets and for high strength steels in oil rigs and gas pipelines.
A sample of the rare earths being found in the Halls Creek region. (Supplied: Northern Minerals)
Chief research scientist at CSIRO, Chris Evans Vernon, said the mine area always held a healthy amount of magnetic rare earth mineral materials, but niobium was an "added opportunity".
"While the niobium levels are not as high as those found in high grade in Brazilian ores, the Yangibana project has the opportunity to produce an additional value stream of niobium concentrate," he said.
"Fundamentally, this should be an attractive proposition."