Challenging economic conditions for the Western Australian resources sector may have scuppered hopes of bringing a new Hilton hotel to the Pilbara.

A $70 million Hilton hotel slated for Western Australia’s mineral rich Pilbara region has received a major setback after the ousting of its original developer by the state’s land authority.

Lands Minister Terry Redman has revealed before the Western Australian state parliament that Landcorp has annulled its agreement with Ramtron Australia for the development of the DoubleTree by Hilton hotel project in the coastal town of Karratha.

The decision would appear to leave both Landcorp and the minister much abashed given the concerns initially raised about the suitability of Ramtron as hotel developer at the time of the company’s selection.

Following a tendering process involving slew of veteran hotel operators, including Western Australia’s Prendiville Group, Landcorp selected Ramtron as hotel developer in June 2012.

The selection of Ramtron as hotel developer was questioned at the time by Opposition spokesperson for Lands Ben Wyatt, given company’s track record of involvement with a string of aborted hotel proposals in Margaret River, Cape Leeuwin, Mingaloo and Beaufort Street.

Redman nonetheless backed Landcorp’s decision based on his confidence in the ability of the agency to perform its core business.

Work on the 144-room project was originally slated to commence towards the end of 2012 in the coastal city of Karratha, which is located adjacent to the port city of Dampier in the Pilbara region.

Other participants included China’s CIMC Modular Building Solutions, who were to provide financing as well as prefab construction techniques for the hotel’s development.

Ramtron’s decision to relocate the site of the hotel to the Karratha Quarter town centre delayed the start of construction to the middle of this year, but the impact of ailing commodities prices on the Pilbara’s mining sectors left both the developer and other financial-backers with trepidations about the project’s economic viability.

Following the annulment of the agreement with Ramtron Australia the proposed Karratha hotel will be left without a set construction schedule or brand until the selection of a replacement developer.