Western Australian firm MACA has been given WPG Resources’ $285 million contract for its Peculiar Knob project in South Australia.
Chairman Bob Duffin said yesterday the deal was a key contract but only the rail contract is likely to be of greater value.
According to MACA, its subsidiary, Mining and Civil Australia will start mobilising to the site in April.
It also said when the mine is in full production, more than 100 people will be employed on the project.
"The contract will generate approximately $285 million in revenue over a period of nearly six years," MACA said in a statement.
"Services to be provided include drilling and blasting and loading and haulage of ore and waste material.
"The Peculiar Knob project is the first contract awarded to MACA outside Western Australia and represents an important next phase of growth for the company."
The WPG board raised more than $200 million to fund the development of Peculiar Knob, south of Coober Pedy and has now signed off on the project.
WPG said it expects to begin exports before the end of the year, and Duffin said the company is now waiting on two approvals.
These are the mining rehabilitation plan (MARP) for the mine and the Development Assessment Commission (DAC) approval for the company’s export facility at Port Pirie.
"If PIRSA (Department of Primary Industries and Resources SA) approves the MARP and the DAC approves Port Pirie during March, which they indicated was a possible time line around about Christmas time… then we will be exporting this calendar year," he said.
"If they meet those time lines we will start site works in April. We will be mining overburden in May and mining ore a few months later."
The company is planning to ship 3.3 million tonnes of direct shipping ore (DSO) per year from Peculiar Knob initially, with expectation to prove up more resources at its nearby Buzzard project to maintain a production rate of three to four million tonnes a year for ten years.
DSO does not have to undergo expensive upgrading before exportation.
WPG also signed up Kerman Contracting to design and build its $54 million iron ore storage facility at Port Pirie in December.
Duffin said the design was in process but the building would not begin until the DAC has signed off on the development.