NEW YORK Rare earths
miner Molycorp Minerals LLC has filed a lawsuit against M&K
Chemical Engineering Consultants Inc. for allegedly violating
contractual obligations to help expand Molycorps flagship
M&K Chemical Engineering is
one of 15 chemical engineering contractors helping Molycorp
develop a new facility, dubbed "Project Phoenix," that will
produce nine additional rare earths at the Mountain Pass,
Calif., mine by late 2012.
Granite City, Ill.-based M&K
allegedly broke its contract with Molycorp by failing to build
according to California state law, providing incomplete
specifications, designing non-functioning plans and drafting
unsafe designs, according to the lawsuit.
"Many of M&Ks designs
were unsafe, creating hazardous conditions that, if not
rectified, could have resulted in serious injury or death to
personnel," according to the complaint.
Project Phoenix will produce
heavy rare earth concentrates, including dysprosium, terbium
and europium, and process them to be used in hybrid electric
vehicles, wind turbines and electronics (
amm.com, Aug. 28). The facility will be the only
one of its kind in the Western Hemisphere, the Greenwood
Village, Colo.-based company said.
The suit, filed Oct. 31 in the
U.S. District Court of Colorado, alleges that M&K designed
incomplete, incorrect and flawed structures and failed to
deliver billed-for designs. Molycorp paid more than $37 million
for M&Ks services and is claiming damages of more
than $45 million.
Despite the purported setbacks,
Project Phoenix is still on schedule to begin production at
M&K declined to comment on