Tag Archives: mine engineering

CIMIC exceeds profit guidance in 2018, positive on 2019 and beyond

Equipment maintenance, Mining finance, Mining maintenance, Mining services, , , , ,

CIMIC says it is expecting to top its net profit after tax 2018 result this year, supported by, among other things, continued strong performance out of the mining sector.

The engineering company, which has a number of mining-related subsidiaries, recorded net profit after tax of A$781 million ($557 million) in 2018, alongside revenue of A$14.7 billion. The former was up 11% year-on-year and at the top end of guidance of A$720-$780 million, while the latter rose 9% year-on-year. CIMIC said all its operating companies recorded growth during 2018.

And, the good news for CIMIC shareholders is that the company estimates its net profit after tax will increase in 2019, with guidance pitched at A$790-$840 million, subject to market conditions.

CIMIC Group Executive Chairman, Marcelino Fernández Verdes, said: “In 2018, we focused on enhancing the capability of our operating companies to provide integrated solutions, ensuring we deliver enduring value for our clients across the lifecycle of their assets, infrastructure and resources projects.

“This collaborative approach has driven an excellent result for our shareholders, is providing exciting opportunities for our people, and will power the next phase of our transformation through digitalisation and innovation.”

In mining, specifically, the company referenced some notable achievements in its results release. This included significant mining services contracts at the Mt Arthur coal operation in the Hunter Valley, Australia, and at the Encuentro Oxides mine in Chile for Thiess; maintenance and shutdown support services by UGL across BHP Billiton Mitsubishi Alliance coal mines in Queensland’s Bowen Basin; and engineering, procurement and construction of the Pumpkin Hollow copper concentrator in Nevada, US, by Sedgman.

The company also secured a A$150 million contract extension at BHP’s Caval Ridge coal mine (pictured) in Queensland.

CIMIC said: “Looking forward, at least A$130 billion of tenders relevant to CIMIC Group are expected to be bid and/or awarded in 2019, and around A$300 billion of projects are coming to the market in 2020 and beyond, including about $120 billion worth of public-private partnership (PPP) projects.”

Fernández Verdes added: “Our pipeline of work has further increased and we have a positive outlook for 2019 and beyond. This is led by the strong performance of the mining sector, an increasing level of infrastructure opportunities in Australia, and the trends towards more outsourcing of services and for greater investment in PPPs.”

Primero, Qube and Lucas TCS named contractors at Core’s Finniss lithium project

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

Australia-based Core Lithium has awarded preferred contractor status for three key components of its 100%-owned Finniss lithium project, near Darwin in the Northern Territory.

The three contractors are key participants in the development team Core is assembling following the granting of the first mining licence earlier this month, it said.

Primero Group has been named the preferred engineering procurement and construction (EPC), and front-end engineering and design (FEED) contractor. Primero has worked on several Australia hard-rock lithium projects including Pilbara Minerals’ Pilgangoora operation and Tawana/Alliance’s Bald Hill mine.

Meanwhile, Qube Bulk Pty has received the status of preferred provider of haulage and transport solutions for Finniss, with Lucas Total Contract Solutions selected as preferred mining services contractor.

Core said it would work with all three companies to finalise contract terms that “reflect the most cost-effective and time-efficient solution for Finniss”.

The FEED study by Primero is underway to improve the accuracy of the EPC estimate on the 1 Mt/y processing plant and associated infrastructure at Finniss, the company said.

In line with its construction schedule, Core is targeting first production of spodumene concentrate from Finniss by the end of 2019.

Core’s Managing Director, Stephen Biggins, said: “These key contract roles are crucial for the success of the Finniss lithium project, so we did not make our decisions on who should be awarded these packages of work lightly. We believe we have selected the best contractors for the respective contracts out a field of worthy contractors, and look forward to working with Primero, Lucas TCS and Qube once the contracts have been finalised and the next phases of work at Finniss get underway.”

He added that final award of the contracts would follow the completion and release of a definitive feasibility study on Finniss, in addition to financing of the project.

Core’s development of Finniss is initially centred on production from the high-grade Grants deposit as an open-pit mining operation and construction of a 1 Mt/y dense media separation process plant to produce a 5% Li2O spodumene concentrate for export.

The prefeasibility study on the project envisaged a total capex of A$53.55 million ($38 million) and A$168 million (pre-tax) in free cash generation over a period of 26 months based on a price of $649/t for its concentrate.

EGL agrees to buy RCR Tomlinson’s energy division

Energy minerals, Environmental, Mining mergers and acquisitions, Mining services, Power supply for mines, , ,

The administrator for RCR Tomlinson has found a buyer for its energy division as it continues to reorganise the engineering group and pay off its debt.

ASX-listed The Environmental Group Limited (EGL) has agreed to acquire the assets of RCR Energy Service. The service provider for heat transfer plant and equipment, which operates from facilities around Australia, generated sales of A$21.5 million in its 2018 financial year, alongside earnings before interest and tax of A$1.5 million ($15.3 million).

The sold company’s primary focus is on commercial gas and steam boilers, as well as thermal oil heaters and hot water heaters. The transaction follows the divestment of the RCR O’Donnnell Griffin’s Rail business to John Holland, in late December.

EGL said the acquisition was part of its strategy to “establish a footprint in each Australian state and build an environmental business to improve air quality, reduce carbon emissions, enhance waste-to-energy production and lift water quality. In particular, RCR Energy Service is an essential link in our strategy to build a bio/waste-to-energy platform as part of the technology acquired enables a combination of gases and waste energy sources to be used to produce electrical power or steam.”

RCR’s administrator said the deal was expected to complete in the second half of January and it was confident of achieving further sales in the near term.

As of the end of its 2018 financial year, RCR Tomlinson had total liabilities of A$581.3 million alongside cash and equivalents of A$89.9 million.

WorleyParsons to buy Jacobs Engineering ECR for $3.3 billion

Base metals, Coal technology, Energy minerals, Environmental, High tech minerals, Industrial minerals, Mineral project development, Mining mergers and acquisitions, Mining services, Precious metals, Steel and iron ore, Water management, , , , ,

WorleyParsons Ltd has paid $3.3 billion to acquire Jacobs Engineering Group’s energy, chemicals and resources (ECR) business as it looks to create a “pre-eminent global player across hydrocarbons, chemicals and minerals and metals”.

The transaction is expected to deliver approximately 50% earnings per share accretion on a financial year 2018 pro-forma basis after factoring in run-rate cost synergies, according to WorleyParsons.

This deal continues the trend of consolidation in the engineering sector. Jacobs acquired CH2M Hill Cos ltd for $3.3 billion last year and Amec Foster Wheeler took over John Wood Group for some $2.9 billion around the same time.

WorleyParsons CEO Andrew Wood said: “The transaction will bring complementary capabilities in key business lines, including a best-in-class onshore and downstream maintenance, modifications and operations capability, allowing customers to benefit from an expanded integrated solutions offering.”

Following the completion of the transaction, Jacobs will be focused solely on two of its higher growth, higher margin lines of business – aerospace, technology, environmental and nuclear and buildings, infrastructure & advanced facilities, Jacobs said.

Jacobs Chairman and CEO Steve Demetriou said: “For Jacobs, this transaction marks an inflection point in our portfolio transformation focused on more consistent, higher-margin growth as a leader solving the world’s critical challenges.”

The transaction will see Jacobs receive $2.6 billion in cash and 58.2 million shares of WorleyParsons, equivalent to $700 million, or 11% of the company.

Jacobs ECR had aggregated revenue and pro-forma EBITDA of $3.4 billion and $286 million, respectively in the 2018 financial year.

Should all go according to plan, WorleyParsons expects the deal to be complete some four to six months from now.

Weba Chute Systems looks to Russia with Somex agreement

Bulk handling, Coal technology, Comminution of minerals, Equipment maintenance, Mineral processing, Mining equipment, Mining services, Precious metals, Steel and iron ore, , ,

South Africa-based OEM Weba Chute Systems has further extended its footprint into the northern hemisphere with the recent appointment of Somex as a licensee in Russia.

Managing Director of Weba Chute Systems, Mark Baller said the selection of Somex as its partner in Russia is in line with the company’s long-term goal of a sustainable international business model.

“We have always been very selective about the markets which we enter,” Baller said. “We obviously seek those markets that offer the greatest potential, partnering with companies that have the best possible fit to ensure a sustainable future there.”

This approach has proven successful, with Weba already having extensive representation across the globe with licensees and agents in the US, Canada, South America, Turkey and Australia, as well as throughout Africa. Significantly, Weba Chute Systems has an established reputation with more than 4,500 of its custom-engineered chute systems installed all over the world.

“When we identified Russia as a prospective market for us, Somex was a partner that fulfilled our demanding requirements,” Baller said. “Somex operates 20 offices across the Russian territory and has an extensive range of products and services which have synergy with our custom engineered chute and transfer systems.”

Baller added that Somex also has a solid engineering capability with manufacturing facilities that produce quality products, as well as an extensive sales network across a spectrum of industries where bulk materials need to be transferred.

“Russia is important because it is one of the largest producers of raw materials globally, with a relatively untapped market where Weba Chute Systems would be of immediate benefit to many operations,” he said. “Many of the plants we visited in Russia are state-of-the-art facilities with high-tech equipment and best practice efficiencies. However, on the materials handling side, there is a huge need for improvement and we can bring the skills and technical knowledge to optimise these operations.”

Weather conditions in the northern hemisphere place vastly different demands on materials handling operations, but Baller said this is a learning curve the company has already undergone.

“In Russia, there are extremes in weather conditions from hot, humid summers to freezing winters which means equipment has to accommodate the way this affects the material being handled,” he said. “If moist material freezes in a barge, for instance, the particles being unloaded could become larger chunks of 20 to 30 times the specified lump size.”

He notes a range of other factors must also be considered during the design phase, including the lack of accessibility to many mines during certain times of the year. This requires that maintenance and servicing must be carefully planned in advance of product delivery, to ensure optimal uptime and continuous, cost-effective operation.

“We are excited by the signing of this new licensee agreement with Somex and look forward to adding our expertise in chute systems to assist mines and other materials handling plants in Russia to lower their overall cost of ownership,” Baller concluded.

Metso’s valves business looks for Smart solutions with Hexagon PPM partnership

Bulk handling, Energy minerals, Environmental, Mineral processing, Mining services, Mining software, Precious metals, Steel and iron ore, , , ,

Metso’s valves business area has joined forces with Hexagon PPM as the Finland-based company looks to ramp up its quotation efficiency for engineering firms.

The agreement complements Metso’s digital quotation tools and will enhance the “efficient exchange of enquiry, quotation and project execution data between Metso and its engineering, procurement and construction (EPC) customers who use Hexagon PPM’s SmartPlant and Smart software suites”, according to Metso.

Oscar Bronsveld, responsible for Global Project Sales at Metso’s Valves business area, said the majority of the company’s EPC customers in the oil and gas, and petrochemical industries use the Smart Instrumentation software suite.

“Our target is to improve our responsiveness and bring value to them by saving them precious engineering hours in data processing,” he said.

Hexagon’s PPM division is a leading provider of asset life cycle solutions for design, construction, and operation of industrial facilities. It transforms unstructured information into a smart digital asset, allowing clients to visualise, build, and manage structures and facilities of all complexities, ensuring safe and efficient operation throughout the entire life cycle, according to Metso.

Back in July, Ausenco, a global consulting, engineering, project delivery, operations and asset management company, selected the suite of engineering design tools, information management solutions and cloud services from Hexagon’s PPM division to execute global projects,  including in the mining and oil and gas sectors.

Metso’s existing digital valve project quotation tool will be integrated with Hexagon’s Smart Instrumentation tool, which offers a “single engineering environment to create and manage instrumentation data, as well as create and manage change consistently across required deliverables”, according to Hexagon.

Metso said: “This integration will provide a bi-directional data exchange capability with the EPCs, allowing a reduction in the quotation processing time and an increase in accuracy when configuring and documenting projects in the quotation phases.”

Rashmi Kasat, VP, Head of Digital Business Development at Metso, said: “Our vision is to provide our clients with a seamless customer experience by combining the power of Metso’s digital tools, knowledge of the end customers’ technical needs and process requirements together with Hexagon’s solid experience in engineering and information software development.”