BHP Billiton has lodged a multi-million counterclaim against contractor VDM Group in a dispute over uncompleted work at its Jimblebar mine.
The multi-national miner removed VDM’s crew at the mine in August before the completion of the $25 million contract.
Since then VDM has won $4 million worth of claims against BHP through a mediation process where it is seeking $10 million in damages.
However WA News reports BHP is now seeking more than $5 million from VDM for failing to finish work at the site.
Lawyers for the contractor are expected to argue work could not be completed as the contractor was removed from the mine.
Yesterday, VDM was forced into a trading halt prior to plans to secure $10 million in capital raising.
In October the company warned it could face collapse if shareholders did not support a recapitalisation from investment firm H&H Holdings Australia.
A third of its administrative staff and some senior executives were among the redundancies.
"If conversion and the recapitalisation plan do not proceed this is likely to affect the solvency of the company and may result in the directors having no option other than to place the company into voluntary administration," VDM said at the time.
According to the paper, the company still plans to send out a revised prospectus today for a share rights issue.
BHP has been sought for comment.