Reports in the Herald Sun say that major backer Texan oil investor Jeff Sandefer is ready to place the embattled company into receivership this afternoon as the company tinkers on the edge of financial collapse.

Sandefer invested $34 million in the project in May this year and was due to place more once crucial preconditions had been met, such as approval for the oil shale project's environmental impact statement, so far they have failed to be achieved.

This combined with a $6 million cost blowout associated with a shutdown of the Stuart plant has led to the cash crisis.

SPP has told the stock exchange that it is seeking $10 million to boost working capital for the Stuart Project, which has already drawn more than $300 million for the development of a demonstration plant, although, even the fresh injection will only see the company through until February.

Despite its financial woes the company continued to set an oil production target from the plant of 600,000 bbl for the full year 2003, and targeting an output of 1.2 million bbl by 2005.

However, full commercialisation is estimated to require a further investment of at least $3 billion.

Attempts to raise new funds are under way, with the most likely proposals giving complete control to Sandefer.