Tag Archives: Mark Norwell

Perenti books exploration, development and production work with Australian miners

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Perenti says it has secured new work and contract extensions with the likes of Regis Resources, BHP Mitsubishi Alliance (BMA) and Catalyst Metal in Australia representing nearly A$150 million ($97 million) of revenue across its 2024 and 2025 financial years.

It has booked a A$70 million, six-month contract for the continuation of underground development and production works at the Regis Resources Garden Well and Rosemont underground gold mines. Barminco and Regis continue to progress collaboratively towards further and material contract extensions at these two mines, it says.

It has also sealed a A$27 million, 24-month contract for exploration surface drilling services at the BHP Mitsubishi Alliance in Queensland, while a A$14 million, 24-month contract has been awarded for underground diamond drilling works at Catalyst Metal’s Plutonic underground gold mine in Western Australia, subject to finalisation of contract terms.

Furthermore, AUMS (through UMA, a joint venture with Rocksure International) received a limited notice to proceed related to the initial underground development works at the Newmont Akyem underground gold mine in Ghana. The finalisation of contractual negotiations continues, however, once finalised it is forecast that the contract could represent circa-A$32 million of revenue over an initial term of 11 months, with a capital structure that is likely to be similar to that adopted for Newmont’s Subika project.

Mark Norwell, Managing Director & Chief Executive Officer of Perenti, said: “The award of these contracts and the limited notice to proceed across both our underground and surface mining businesses demonstrates the diversity of our service offering and the strength of the relationships we share with our clients. Collectively these three contracts and the limited notice to proceed represent nearly A$150 million of revenue across FY2024 and into FY2025 and come after the recent announcement in which Perenti secured circa-A$360 million of revenue at the Sandfire Resources A4 project in Botswana.”

Perenti’s AMS to add A4 open pit services to Sandfire Motheo copper mine contract mining works

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Perenti Limited’s surface mining business in Africa, African Mining Services (AMS), has been awarded the contract for open-pit mining services at the Sandfire Resources A4 open pit within the larger Motheo copper mine in Ghanzi, Botswana.

The contract is valued at $235 million over a term of 73 months.

Under the terms of the contract, AMS will deliver all surface mining services associated with development and production activities at the A4 open pit.

The A4 open pit is located around 8 km to the west of Sandfire’s existing T3 open pit, where AMS has successfully progressed from development into production works. Perenti anticipates A4 pre-production and development work to commence in September 2023, with pre-strip mining to start in October 2023.

The T3 and A4 open pits are expected to be operated as a larger, integrated mining operation and, therefore, will leverage the resulting benefits of scale and the operational synergies to optimise the return on capital aligned with our financial targets. The primary synergies include the optimisation of existing infrastructure, mining equipment, maintenance facilities and both technical and operational management.

Mark Norwell, Managing Director & Chief Executive Officer of Perenti, said: “We are excited about the opportunity to expand our partnership with Sandfire Resources. Motheo is a long-life asset in the Kalahari Copper belt, and
the expansion of our role here is in keeping with our strategy of disciplined growth within top-tier mining jurisdictions with high quality partners. Sandfire is now one of our largest clients and over the term of the combined contracts, the T3 and A4 open pits are expected to generate total revenue of over A$1.1 billion, delivering strong returns for Perenti and its shareholders.”

Paul Muller, President of Contract Mining, said: “Since Barminco commenced operations in 2019 and AMS later in 2021, Perenti has established itself as the leading international mining contractor in the Kalahari Copper belt. With the award of our third mine in the region, we look forward to playing our part in Sandfire’s expansion of their world-class Motheo copper mine. Beyond this, I am proud of the contribution Barminco, AMS and Perenti continue to make to the development of Botswana’s mining industry and the community more broadly.”

Perenti looks to create ASX’s leading diversified contract mining services company with DDH1 buy

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Perenti has entered into an agreement under which it will acquire 100% of the issued share capital of DDH1 Limited, a surface and underground mining contractor, subject to satisfaction of conditions.

DDH1 brings significant capability across a range of specialised surface and underground drilling services that complement Perenti’s existing service offering, Perenti says. This will see it benefit from increased scale, and the ability to leverage the operational and financial strengths of both companies. This will enable improved margins and increased free cash flow, which will accelerate the delivery of our FY25 financial targets.

Following the completion of the transaction, which is subject to DDH1 shareholder approval and other conditions, Perenti will become one of the largest drilling services companies globally, increasing growth opportunities for the business and its people, it says.

Perenti estimated that it would create the ASX’s leading diversified contract mining services company, with a pro forma market capitalisation of circa A$1.3 billion ($868 million, pre-synergies and potential re-rate), positioning Perenti for potential ASX200 inclusion. Perenti added that 85% of its revenue base will be from production and resource definition (rather than exploration), with the company holding a modern fleet with over 190 rigs from DDH1 and 99 from Perenti – one of the largest drill fleets globally.

In 2021, DDH1 combined with Swick Mining Services to create, they said, a global scale mineral drilling business with a balance of surface and underground services.

Mark Norwell, Managing Director & CEO of Perenti, said: “This is a compelling transaction that represents an exciting next step in delivering on Perenti’s purpose, to create enduring value and certainty, by building a portfolio of complementary high quality businesses.

“Perenti has a long history in drilling from its Ausdrill heritage and Barminco Diamond Drilling business and understands the attractiveness of the market.

“The long-term outlook for a sustained production cycle needs increased drilling spend to ensure mining reserves are not diminished, and drilling is becoming more complex, resulting in larger programs and demand for specialist services.

“DDH1 is a highly respected Tier 1 global operator, with significant capabilities across a complete range of specialised surface and underground drilling services, that are complementary to our existing clients and service offering.

“We have a clearly articulated framework against which we assess all investment opportunities, with this transaction addressing our key assessment criteria in relation to strategic attractiveness, fit within Perenti and value creation potential.”

Following the transaction, the DDH1 business will form part of a newly created Drilling Services Division, which will also comprise Perenti’s existing Ausdrill business. Sy Van Dyk (current Managing Director & CEO of DDH1), will be appointed as President of the newly created division. Each of the four existing DDH1 brands, DDH1 Drilling, Ranger Drilling, Strike Drilling and Swick Mining Services, will be maintained and led by their existing leadership teams, with a focus on providing a consistent offering and customer continuity.

Perenti hopes to close the deal in October based on its indicative timetable.

Perenti’s AUMS extends ties with Newmont at Subika Underground

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Perenti Limited’s African Underground Mining Services (AUMS) subsidiary, through its UMA joint venture, has been awarded a new, circa-A$630 million ($418 million), 60-month contract at the Newmont Subika underground gold mine in Ghana, the ASX-listed company says.

The term of the contract is effective from January 1, 2023.

UMA is a joint venture (70:30) between AUMS and Rocksure International, a local Ghana-based civil and mining contractor. Under the terms of the contract, through the UMA joint venture, Perenti will undertake all underground development and production activities, diamond drilling and associated support services at the Subika Underground Mine, some 310 km to the northwest of Accra, Ghana.

In addition, under the terms of the new contract Newmont will acquire the current fleet of underground equipment associated with the project and will also be responsible for the acquisition of additional fleet as required for the project, Perenti says.

Perenti expects that this capital strategy will have significant benefits, but primarily will reduce the capital intensity of the project while still delivering strong returns. Perenti expects to finalise the sale of these assets before the end of June.

As a part of Newmont’s larger Ahafo complex, AUMS commenced development and production activities at the Subika underground mine in mid-2017.

Mark Norwell, Managing Director and CEO of Perenti, said: “With this new contract, Perenti not only expands its tenure in Ghana but furthers its relationship with Newmont, the world’s leading gold company with a world-class portfolio of assets in favourable mining jurisdictions. We are very pleased that we will continue to deliver value and certainly to Newmont and our other stakeholders in Ghana and beyond.”

Paul Muller, President Contract Mining of Perenti, said: “Ausdrill commenced operations in Ghana in 1991 and, with this 60-month contract, Perenti through its subsidiaries, will have accumulated nearly 40 years of in-country expertise with a strong track record of prioritising local procurement, training and employment opportunities across a wide range of local and regional Ghanaian stakeholders.”

Barminco wins A$90 million contract extension at Newcrest’s Red Chris mine

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Perenti subsidiary, Barminco, says it has been awarded a 12-month contract extension at Newcrest Mining’s Red Chris mine in British Columbia, Canada.

Since June 2021, Barminco has continued to progress the development of an underground exploration decline, an essential first stage of works that will provide a platform for future underground exploration activities, and which may also be used to support access to potential block cave workings.

This contract extension enables Barminco to continue underground development works and is expected to deliver approximately A$90 million ($60.4 million) of revenue over the 12-month contract term.

Mark Norwell, Managing Director and CEO of Perenti, said, “Our strategy in North America is to partner with Tier-One operators and long-life assets, where we can add value over the long term. We continue to diligently progress our North American growth strategy and have key executive management personnel based in the region to ensure we develop the right relationships and become engrained within the sector while remaining disciplined in the execution of our strategy.”

Paul Muller, President of Contract Mining, said: “Since mid-2021 our team in North America has worked closely with the Red Chris JV as it transforms the mine into a long life, tier-one underground operation. We have developed very strong relationships with the local communities including a partnership with the Tahltan Nation Development Corporation and are very pleased to be on site at Red Chris for at least the next 12 months.”

An October 2021 prefeasibility study on the Red Chris block cave outlined an initial reserve estimate of 8.1 Moz of gold and 2.2 Mt of copper, with average annual gold production of 158,000 oz and copper production of 48,500 t over the 31-year life of mine.

Barminco wins extended stay at IGO’s Flying Fox nickel mine

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Perenti says its Barminco subsidiary has been awarded a nine-month contract extension at the Flying Fox mine, in Western Australia, owned and operated by IGO Ltd.

The contract extension is effective from January 1, 2023, and has a value of approximately A$30 million ($20.2 million) over the nine-month term.

Mark Norwell, Managing Director & CEO of Perenti, said: “In Australia, the labour market is still tight, and inflation and cost escalation remains stubbornly persistent, however strong and collaborative working relationships, like the relationship between IGO and Barminco, are key to the success of our business as well as the success of our clients. By working collaboratively with our clients, we continue to navigate and manage challenging macro-economic conditions.”

Paul Muller, President of Perenti Contract Mining, added: “We have a very long and proud history of operating within the Forrestania Operation and we are pleased to have delivered value and certainty at the Flying Fox mine from a greenfield development project through to a mature operating mine as it is today. We look forward to continuing our relationship with IGO, our largest client in Australia.”

IGO became the owner of the Flying Fox mine, part of the Forrestania Operation, in 2022, as part of the acquisition of Western Areas. It remains one of the highest grade nickel mines in the world. Production commenced in 2006, and the mine now operates at depths of over 1 km underground.

Perenti secures largest ever Australia surface mining contract at KCGM’s Fimiston mine

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Perenti Limited says its Ausdrill subsidiary has been awarded a new surface miningcontract at the Northern Star Resources-owned Kalgoorlie Consolidated Gold Mines (KCGM) Fimiston open-pit gold mine in Kalgoorlie, Western Australia.

The new circa-A$160 million ($110 million), 60-month contract incorporates activities that commenced March 1, 2022, and will continue to March 2027.

Ausdrill has been contracted to provide up to 14 production blasthole drill rigs to support ongoing operations.

Given the scale and quality of its existing Ausdrill fleet, Perenti does not expect any new capital outlay to support this contract, it said.

Mark Norwell, Managing Director & CEO of Perenti, said “We continue to remain focused on supporting the families, friends, and colleagues of Trevor and Dylan following the tragic incident at the MMG-owned and Barminco-operated, Dugald River mine in Queensland last week. However, over the weekend Ausdrill executed a material contract and in-line with our disclosure obligations, we are providing the market with an update.

“We have secured our largest ever surface contract in Australia, which continues our relationship at one of Ausdrill’s first ever projects. We are very proud to be part of Kalgoorlie’s history and we look forward to continuing to deliver certainty and value for Northern Star, our employees and business partners.”

He added: “Since the release of our operational update on 19 December 2022, we have continued to deliver on our strategic objectives and while we have seen some strengthening of the Australian dollar relative to the US dollar, we have seen overall margin improvement and continued to win or extend existing contracts, positively resolve commercial negotiations and further simplify our business. Market conditions continue to remain favourable into the second half of financial year 2023 in support of further delivery against our 2025 strategy. We look forward to providing additional details when we release our first half 2023 results tomorrow.”

Paul Muller, President Contract Mining at Perenti, said “Ausdrill began with two drill rigs in 1987 at the Fimiston mine. Since then, Ausdrill has continued to expand its services to include blast hole and grade control drilling, utilising a fleet of drill rigs specifically designed and manufactured (in-house) to meet the unique specifications required by the Fimiston open-pit mine.

“We look forward to continuing to provide our value-add expertise to the KCGM operations while extending our long-standing relationship with our local and regional stakeholders.”

Perenti’s Barminco to carry out development works at Evolution Mining’s Ernest Henry mine

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Australia-based Perenti has provided an operational update and an upgrade to its financial year 2023 guidance to end-June 2023, which includes confirmation of a new contract for Barminco at Evolution Mining’s Ernest Henry mine in Queensland and a variation to expand its work scope at Regis Resources’ Garden Well mine in Western Australia.

The positive momentum noted in the operational update released on November 14 has continued as Perenti heads toward the end of the calendar year, with this momentum expected to continue into 2023, it noted.

“Since the release of the most recent operational update Perenti has secured improvements to commercial conditions across several Australian and African projects, including retrospective rate adjustments in relation to work that has previously been completed,” it said.

“These rate adjustments are the key catalyst in providing a further guidance upgrade one month after our previous upgrade.”

The contract at Ernest Henry (pictured) is for development work at the underground gold and copper mine. As Barminco transitions out of MMG’s Dugald River mine – where it has been carrying out development and production works – early next year, employees and capital resources from Dugald River will be mobilised to the new contract at Ernest Henry, it said. Underground development work at Dugald River, meanwhile, is to be taken on by Redpath Australia.

The Garden Well extension follows the commencement of underground mine development at the deposit in 2021.

On November 14, Perenti updated its FY23 guidance to forecast FY23 revenue of between $2.6-$2.7 billion ($1.7-1.8 billion). With the announcement of improved commercial conditions, and in consideration of securing work at Ernest Henry and scope growth at Garden Well, Perenti now forecasts that the company’s FY23 revenue will be between $2.7-$2.9 billion.

Mark Norwell, Managing Director and CEO of Perenti, said: “In addition to generating greater returns in FY23, we are focused on continuing to pursue business and project optimisation initiatives which will facilitate the delivering our 2025 strategy. Our strategy is designed to drive positive momentum in shareholder value well into the future. Perenti’s outlook is underpinned by our world-class Contract Mining Division, and the continued development of our Mining Services and idoba divisions. Our focus on generating enduring value for our people, clients and communities, will ensure we continue to deliver sustainable returns for our shareholders.”

ABB and Perenti to collaborate on mining electrification projects

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Perenti has signed an agreement with ABB to collaborate and explore approaches to support net-zero emissions targets for underground and open-pit mines.

Experts from the two companies will work together to address electrification in mine hauling operations, power distribution, energy efficiency and power management, the companies said.

Australia-based Perenti has mining expertise and technical capability, which complements ABB’s technology expertise. Together, the teams plan to explore business models and solutions to provide wider services for pilot, brownfield and greenfield mining customer projects to support the electrification of operations.

ABB has been calling for open collaboration within the mining industry and has taken action on several similar initial non-binding agreements to build commitments with original equipment manufacturers (OEMs), technology innovators and mining companies. This includes pacts with FLSmidth, Amazon Web Services, MEDATech, Liebherr and others.

“Mining customers are committed to facing environmental, societal and economic challenges head on as they aim to decarbonise mining operations,” Joachim Braun, Division President, Process Industries, ABB, said. “With ABB’s sector leading position in electric mine technology development, and Perenti’s excellence and experience in mine development and mine operations, the scope of this collaboration is a perfect opportunity to make real progress in providing electric solutions that will decarbonise the industry.”

Mark Norwell, Managing Director and CEO, Perenti, said: “ABB and Perenti share a vision to develop energy-efficient solutions for the mining industry. By combining our experience across mining operations and digital solutions with ABB’s leading technologies we are focused on supporting the decarbonisation of mining through electrification. We look forward to working with ABB on this exciting new venture.”

ABB launched its ABB Ability™ eMine portfolio of technologies and methodologies last year, an approach to make the all-electric mine possible, with fully integrated electrification and digital systems from mine to port.

Perenti says it is committed to acting on climate change through promoting innovation, developing and deploying low emissions technology and working with its clients to implement projects that improve energy efficiency and reduce emissions.

Barminco to help Evolution go underground at Cowal gold mine

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Perenti’s Barminco underground mining business has been awarded the contract for all underground development and production works for Evolution Mining’s Cowal Underground project in New South Wales, Australia.

Barminco, a leading global underground mining services business, is currently developing an exploration decline and conducting diamond drilling services at Cowal.

Last year, the board and regulators approved the development of the Cowal Underground Mine, which is set to provide a higher-grade ore source that will be blended with the current E42 open pit and stockpile ore. The development is part of the group’s goal of Cowal producing 350,000 oz/y of low-cost gold and extending the operation’s mine life.

Perenti said the award of this new contract significantly expands Barminco’s scope at the site to include the development of a second portal, all underground development and production works, and associated underground mining services required to support the continued mill feed of underground ore.

Mark Norwell, Managing Director and CEO of Perenti, said the award of the Cowal contract aligns with Perenti’s strategy of increasing its earnings in top-tier regions and with top-tier clients.

“The Cowal contract represents one of the largest underground mining projects in Barminco’s history, generating revenue of nearly A$520 million ($373 million) with an initial term of four years, from a contract commencement date in early July 2022,” Norwell said.

“This contract award represents not only a significant expansion and continuation of our first underground contract in New South Wales but is also a fantastic opportunity for Perenti to build on our strong working relationship with Evolution, one of Australia’s premier gold mining companies.”

Norwell explained that, between now and the end of Perenti’s 2022 financial year, the company will commence investing the capital required for this project with revenues and earnings ramping up in the 2023 financial year and beyond.

“The project represents a significant improvement to our Australian underground earnings base and will generate strong project cash flows and returns in support of our capital allocation and investment,” he added.