Tag Archives: contract mining

Macmahon’s GBF wins contract extension at Silver Lake’s Mount Monger ops

Mine operation news, Mining services, Precious metals, , , , , ,

Macmahon Holdings’ acquisition of underground contracting business, GBF Group, is already paying off, with GBF receiving a conditional letter of intent from Silver Lake Resources for further work at the Mount Monger gold operations in Kalgoorlie, Western Australia.

GBF has been operating at Mount Monger since 2014 and currently provides mining services to the Daisy Complex, Cock-eyed Bob and Maxwells mines, which form part of this operation, expected to produce 120,000-130,000 oz of gold-equivalent in Silver Lake’s 2020 financial year.

Under the new letter of intent, GBF’s tenure at these sites will be extended for three years from March 1, 2020, and GBF will also develop Silver Lake’s new Santa mine, due to commence next month.

GBF estimates the value of the new work with Silver Lake will add around A$200 million ($134 million) to its order book. The two companies will now negotiate the formal mining services agreement, with finalisation expected in March, Macmahon said.

Macmahon CEO and MD, Michael Finnegan, said: “The new work is an important milestone in our strategy to further expand in the underground market, and demonstrates the value in our GBF acquisition. We are looking forward to working closely with Silver Lake on this project and building on our relationship with this key client.”

Perenti considering further Australia mining services consolidation

Mining mergers and acquisitions, Mining services, , , , ,

In response to media speculation, Perenti has confirmed it is “currently giving consideration” to the potential purchase of Downer EDI’s mining services division.

“The process is ongoing and Perenti would only put forward an offer to acquire the business if it were to align with its strategy and deliver value for the company’s shareholders,” it said.

Downer confirmed in November that it would be undertaking a portfolio review “to determine whether there are opportunities to enhance the alignment” of its portfolio, noting that an important area of focus for the review was the mining business.

Perenti, a global mining services firm, has expanded substantially in the past few years, acquiring Barminco in late 2018 to become Australia’s second-largest mining services company.

Redpath to deliver Pumpkin Hollow ramp-up, Nevada Copper says

Base metals, Mine operation news, Mining services, , , , , , ,

Nevada Copper has engaged mining contractor Redpath USA to implement its ramp-up strategy for its underground copper mine at Pumpkin Hollow, in Nevada.

The company commenced production at the underground mine in December and is now entering into a new phase of development supporting its ongoing operations. It said it has “high confidence” in Redpath’s ability as a partner during the ramp-up to full commercial production in 2020.

Redpath replaces the previous mining contractor and will be the company’s principal underground mining contractor going forward, Nevada Copper said. “Redpath is a highly experienced mining contractor with experience of delivering complex projects both internationally and in Nevada, ahead of schedule and under budget,” it added.

Matt Gili, Chief Executive Officer of Nevada Copper, said: “Nevada Copper made the transition to producer in Q4 (December quarter) 2019 and we have developed a clear, straightforward strategy for ramping up our Pumpkin Hollow underground project to full commercial production. Redpath is considered throughout the mining industry as the partner of choice for production ramp up and we are excited to be working with them during this important period of growth.”

Nevada Copper has previously said it is focused on ramping up the mine, in Yerington, to reach nameplate capacity in the first half of 2020.

The 2017 prefeasibility study plan for the underground mine outlined a 5,000 t/d project able to produce some 50 MIb/y (22,680 t/y) of copper, 8,000 oz of gold and 150,000 oz of silver over a 13.5-year life at all-in sustaining costs of $1.96/Ib of copper. It also laid the foundations for a larger integrated project that includes open-pit development and could increase throughput to 70,000 t/d.

Panoramic looks to Barminco for Savannah nickel-copper-cobalt ramp up

Base metals, Energy minerals, Mine operation news, Mining equipment, Mining services, , , , , , , , , , ,

Perenti’s hard-rock underground mining subsidiary, Barminco, has been selected as the preferred contractor by Panoramic Resources at its Savannah nickel-copper-cobalt project in the Kimberley region of Western Australia.

The contract, worth around A$200 million ($135 million), will see Barminco carry out mine development, production, and haulage over a three-year term. Work is expected to commence in March 2020.

Barminco anticipates it will employ around 170 people for the project and use predominately new equipment, which has been included in the capital guidance previously provided, to deliver the project.

Savannah, 110 km north of Halls Creek in Western Australia, saw mining operations recommence in December 2018, with the first shipment of concentrate departing Wyndham in February 2019. The miner is currently developing the higher-grade Savannah North orebody focusing on high speed development and a ramp up to full production in 2020, Perenti said.

Perenti Managing Director, Mark Norwell, said: “This project demonstrates our ability to capture organic growth opportunities, with the Barminco business now well integrated into the Perenti group whilst further embedding itself as a leader in underground mining.”

Underground Chief Executive Officer, Paul Muller, added: “We look forward to working closely with Panoramic Resources in driving the development of the Savannah North orebody safely and efficiently as it ramps up to full production.”

Downer EDI to continue work at Stanwell’s Meandu coal mine

Coal technology, Mine operation news, Mining services, , , , , , ,

Downer EDI has been awarded a five-year contract extension, valued at around A$600 million ($412 million), to provide mining and related services at the Meandu coal mine, in Queensland, Australia.

The mine is owned by Stanwell Corp, has a 7.6 Mt/y thermal coal capability and is in Queensland’s South Burnett Region.

Under the contract, Downer will carry out full mining services, including operation of the coal handling and preparation plant (CHPP). The new contract extends Downer’s current remit at the mine, which commenced in 2013 and expires on June 30, 2020. The new contract will commence on July 1.

Grant Fenn, CEO of Downer, said: “Downer has worked closely with Stanwell since 2013 and we look forward to continuing to provide safe and productive services at Meandu mine.”

Downer’s Queensland operations include the Blackwater, Commodore, Goonyella and Meandu coal mines.

MACA exits Brazil, prepares for more FQM Ravensthorpe work

Base metals, Mine operation news, Mining equipment, Mining services, , , , , , ,

Contract miner, MACA Ltd, says it will cease operations in Brazil, effective January 2020, following the early termination of a contract at the Antas copper mine.

The contract, due to conclude in 2020, was with AVB Mineracao Ltda, a subsidiary of OZ Minerals, which announced back in mid-2019 that it planned to close the Antas open pit (pictured) in 2021. The reduction in the work in hand (WIH) position as a result of the early termination will be around A$8 million ($5.5 million), the company said.

At the same time as announcing this news, MACA said its mining division had received a letter of intent (LOI) from First Quantum Minerals to carry out works at the Tamarine limestone quarry, in Western Australia, including mining, crushing and screening of limestone over a three-year period. This contract was worth around A$20 million over that timeframe, MACA said.

The LOI follows the Ravensthorpe contract award with First Quantum that was announced November 20, 2019. MACA said works were expected to start in February utilising existing crushing equipment.

In Brazil, MACA said it would retain ownership of the majority of the plant and equipment currently utilised at the Antas copper mine, in Para state, northern Brazil, and would dispose of assets that are not redeployed to other operations.

“It is expected there will be a non-cash impairment related to the cessation of operations in Brazil of approximately A$2 million,” MACA said. “In addition, there are unrealised forex losses that will be triggered upon closure of the subsidiary, of approximately A$5 million based on current exchange rates.”

Profit from ordinary operations was not expected to be impacted as a result of the closure given the recent financial performance of the contract, MACA added.

WIH attributable to MACA as at January 31, 2020 is expected to be A$2.3 billion across all business units, MACA said, with current guidance for financial year 2020 (to end-June) remaining at A$770 million revenue and EBITDA from operations (excluding the impact of the Antas impairment and forex losses) to be in a range of A$104-$110 million.

Capital Drilling bolsters Bonikro gold mine operation with new equipment

Equipment maintenance, Mine operation news, Mining equipment, Mining services, Precious metals, , , , ,

Capital Drilling says it has commissioned new equipment to supplement Allied Gold’s existing mining fleet at the Bonikro gold mine, in Côte d’Ivoire, with the two companies currently in the process of implementing an interim mine plan at the operation.

The London-listed company was awarded the mining services contract – the company’s first – back in October 2019.

In Capital Drilling’s December quarter review, it said it had further established personnel and equipment to support the contract over this period and, in December, had commissioned three dozers (Cat D9Rs), one grader and one excavator, together with four production rigs (blast hole and grade control) at the operation.

It said 2020 contract revenues, while being subject to finalisation, were now expected to be around $15 million across the range of site services at Bonikro, compared with the $25-$30 million previously outlined.

The interim mine plan at Bonikro was scheduled to last until December 2020, but a long-term mine plan is expected to be completed in the September quarter, it said. This would allow the company to transition to a “Schedule of Rates contract”.

Bonikro commenced production in 2008 and was previously operated by Newcrest, prior to the sale of its majority interest to a consortium of F&M Gold Resources and the Africa Finance Corp, in December 2017, and the recent acquisition by Allied. It has historically produced over 1 Moz of gold.

On top of this news, Capital Drilling said, in its December quarter, revenue jumped 4.8% quarter-on-quarter to $30.7 million, while its cash flow generation had risen to $4.4 million at the end of the year, compared with $2.5 million at the end of the September quarter. This jump in cash came despite ongoing growth capital expenditure during the three-month period.

The company’s fleet utilisation also rose over the quarter to 59%, compared with 52% in the previous quarter. This is the equal highest utilisation level in four years for the group, driven by new contract start-ups, with most of the new work commencing in West Africa, it said.

Capital expected to spend $20 million on capex in 2020. This follows the addition of eight new rigs and mining equipment in 2019, of which four rigs are due for commissioning this quarter.

EMW wins contract mining gig at Colluli sulphate of potash project

Energy minerals, Mineral project development, Mining services, , , , , , ,

Earth Moving Worldwide (EMW) has been confirmed by the Colluli Mining Share Company (CMSC) as its preferred mining contractor at the Colluli sulphate of potash project, in Eritrea.

Danakali, which owns 50% of Colluli alongside the Eritrean National Mining Corp, said EMW has extensive global experience in mining services and will provide the project with strong commercial and technical outcomes.

The agreement covers the pre-production period (development) plus the first five years of production at Colluli, with the scope including the provision, operation and maintenance of excavation, haulage and dewatering equipment.

Colluli has a JORC-2012 compliant measured, indicated and inferred resource of 1,289 Mt at 11% K20 equivalent and 7% kieserite.

Danakali said a competitive tendering process was conducted with technical support from AMC Consultants and Majesso Consulting, and execution of the mining services contract was expected early in 2020, with production due to commence in 2022.

Chief Executive Officer of Danakali, Niels Wage, said: “The confirmation of EMW is another major step for Danakali and Colluli. We are pleased to be working with a company as experienced as EMW who share our commitment to the wellbeing of people and the environment surrounding Colluli.”

Member of the Board of Directors of EMW, Yves Aertssen, said: “EMW is delighted to be selected by Danakali to be part of Colluli. Our shared culture and values were clearly evidenced during the tender process. We are excited to build on this shared vision and work closely with Danakali and all stakeholders in the project to justify the confidence shown in EMW.”

EMW is a private earth moving, mining, processing, coastal protection and reclamation services company with over 140 years’ of global experience in earth moving and haulage activities.

EPSA to carry out mining at Perseus’ Yaouré gold mine

Mineral project development, Mining equipment, Mining services, Precious metals, , , , ,

Development of Perseus Mining’s third gold mine, Yaouré, in Côte d’Ivoire, is ramping up with the award of a mining services contract to EPSA Internacional SA.

The announcement comes shortly after Australia- and Canada-listed Perseus signed the mining convention for the $265 million project.

EPSA, a privately-owned, global earthmoving and mining contractor headquartered in Spain, provides a range of mining, civil works and earthmoving services to a bluechip list of mining clients located in 15 countries, according to Perseus. The company employs around 4,000 and has nearly 1,600 pieces of equipment available for deployment.

The mining services contract will run for a period of 65 months commencing on November 1, 2020, and envisages the movement of approximately 170 Mt of material, including 27 Mt of ore containing more than 1.5 Moz of gold, Perseus said.

EPSA is expected to commence mobilising equipment to site in the March 2020 quarter, after which it will employ and train a predominantly Ivorian workforce in preparation for the formal commencement of the contract later in the year, according to Perseus.

Perseus’s Managing Director and CEO, Jeff Quartermaine said the company was “delighted” to be working with EPSA, “an international mining company of true substance, whose client list currently includes major gold mining companies such as Newmont Goldcorp, Agnico Eagle and Yamana Gold”.

To win this contract, EPSA competed in a highly competitive tender process involving eight very good mining contractors, according to Quartermaine.

“As well as offering a competitive price, EPSA currently has equipment available for immediate mobilisation and has a proven track record of establishing greenfield mining sites in jurisdictions where employment and training of personnel from local catchment communities is a priority.”

When Yaouré is fully operational, Perseus will be producing in excess of 500,000 oz/y, Quartermaine said, adding that the average all-in site cost of producing gold at Yaouré over the first five years of the mine is forecast to be $734/oz.

NRW Holdings continues spending spree with BGC Contracting buy

Mining equipment, Mining mergers and acquisitions, Mining services, , , , ,

NRW Holdings has continued with its M&A spree, agreeing to acquire 100% of BGC Contracting in a deal that comes with an equity value of A$116.4 million ($78.8 million) and expands its Mining Technologies pillar.

BGC Contracting provides services to the resources, energy and infrastructure sectors across three core businesses: mining, construction and DIAB Engineering.

NRW responded to media speculation earlier this month by acknowledging it had been selected as the preferred bidder in the sale of BGC Contracting.

The agreement comes less than a year since NRW Holdings acquired RCR Tomlinson’s Mining and Heat Treatment businesses and a little over two years since it purchased Golding Group.

NRW said: “The business is a strong strategic fit adding significant scale through an expanded service offering to a high-profile client base with a long track record of contract renewal and extension.”

The deal is expected to provide significant strengthening of NRW’s ‘Mining Technologies’ pillar through the addition of DIAB Engineering, which provides specialist industrial engineering, shutdown maintenance and fabrication services and generates “annuity style” revenues, NRW said.

BGC comes with a fleet of over 200 items of “high-quality mobile mining equipment” with a book value in excess of A$200 million, according to NRW Holdings. It also has an existing contract portfolio and order book of around A$1.5 billion, which “delivers a step change in scale”.

NRW says the deal is highly earnings per share accretive and could have pre-tax synergies of A$15 million/y, driven by consolidation and reduction in duplication, including facilities and systems.

Jules Pemberton, CEO & Managing Director of NRW, said: “We are extremely pleased to announce the acquisition of BGC Contracting which is strongly aligned with our objective to pursue opportunities to further diversify our revenues and enhance shareholder returns.”

He added: “We are enthusiastic about the opportunities ahead for the expanded NRW group, to leverage the additional capabilities and regional strengths of the combined group and further capitalise on our strong market reputation.

“Together with our combined workforce of around 6,000 people supporting more than 100 projects around Australia, we are well placed to offer a diverse range of services and project solutions to clients across the infrastructure, resources, industrial engineering, maintenance and urban sectors.”