$1.1 billion Moly Mines contract

MACMAHON Holdings Limited has been awarded a $1.1 billion, seven year contract for the new Moly Mines Spinifex Ridge Molybdenum project about 140 km south east of Port Hedland in the Pilbara Region of Western Australia.

This contract will involve the mining of more than 180 million cubic metres of material over the contract term to deliver 20 million tonnes of high grade ore each year to the processing plant.

Work is expected to commence on site in July, after Moly Mines has received its final approvals to proceed and completed its project financing; initial planning for the mobilisation of our team and equipment is already underway.

The company said that in the first year there will be a great deal of preparatory work including pre-strip activities, then the mine will ramp up in the second 12 months delivering ore to the mill in the second half of calendar 2009 and will be operating at full capacity in the third year.

During the life of the project a fleet of new mining equipment, including 240 tonne dump trucks and large shovels valued at approximately $200 million, will be funded through the equipment operating lease facility, recently established by the Group.

It is expected that when the mine is operating at full capacity, there will be 270 Macmahon employees on site.

With an expected mine life of more than 20 years, Spinifex Ridge will be one of the largest metalliferous mining operations in Australia and will be the world’s next major molybdenum producer, according to Macmahon.

Molybdenum is regarded as vital element in high quality stainless steel products. It is used in the manufacture of stainless steel, alloy steel, tool and high speed steel, catalysts, lubricants and pigments.

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