Demand for mining services ramps up (Part 2)

The Downer-Ausenco JV was awarded a major contract at Gruyere

It was undoubtedly a better year for Australia’s leading mining services companies in 2017.

Improved commodity prices led to an increase in mining activity, meaning the expertise of the country’s mining services contractors was in growing demand.

Australian Mining takes a closer look at some of the companies that were awarded key mining contracts during 2017 in this two-part feature.

Click here for Part 1

Downer
Downer’s 2017 took a turn when Adani became the owner-operator of the Carmichael coal project in Queensland, effectively scrapping the letters of award the two companies had signed for construction and mining at the controversial operation.

How Downer fills the void in work left behind by Adani’s decision to go-it-alone at Carmichael is yet to be seen, but the diversified contractor did manage to bolster its order book in other areas during 2017.

Downer was awarded a $400 million contract to provide mining services at the Gruyere gold joint venture project between Gold Fields and Gold Road Resources in Western Australia.

The five-year contract involves construction of haul roads, stockpiles and other infrastructure; drilling and blasting; loading and haulage of ore and waster; run of mine feed; and technical services.

Its joint venture with Ausenco is also bearing fruit, with OZ Minerals awarding the JV a $312 million EPC contract at the Carrapateena copper-gold project in South Australia.

The Carrapateena scope of works includes engineering, procurement and construction (EPC) of a minerals processing plant, including the non-process infrastructure to support the operations.

Downer Blasting Services (DBS) also won $240 million of work at open cut and underground mines in Queensland, New South Wales and Western Australia.

Macmahon Holdings
Macmahon (it hopes) put CIMIC’s failed takeover attempt for the company behind it by winning lucrative contracts on both sides of the country during the second half of 2017.

In Western Australia, Mamchaon won a mining contract worth at least $250 million at one of the country’s most exciting new gold developments – Dacian Gold’s Mt Morgans operation in the Goldfields.

The five-year contract will see Macmahon provide drilling and blasting, loading, hauling and technical services.

In Queensland, Macmahon executed a $350 million mining services contract at QCoal Group’s majority-owned Byerwen coal mine in the Bowen Basin. The contract involves the provision of all open cut mining and bulk earthworks at the new mine near Glenden.

Macmahon also pursued additional work in Indonesia’s coal industry throughout the year.

Monadelphous
Monadelphous’ diversified contract portfolio was bolstered from a mining perspective during 2017 with new contracts or extensions for maintenance and construction work.

Most recently, Monadelphous secured maintenance and construction contracts in the resources and infrastructure industries worth a combined value of around $110 million.

The work includes a three-year contract to provide shutdown maintenance, breakdown and repair services, minor projects and ad hoc services for BHP at Mount Arthur Coal in the Hunter Valley of NSW.

In September, Monadelphous has secured new maintenance and construction work in the resources industry worth $220 million. The new maintenance work includes a two-year contract to supply fixed maintenance services for Rio Tinto at its Pilbara operations.

Monadelphous was also active in the international mining industry, securing an agreement to provide services for the Shaft 1 and 2 surface infrastructure at the Oyu Tolgoi project in Mongolia.

In the first half of 2017, Monadelphous announced it had secured $120 million worth of new contracts for resources companies, including Fortescue and BHP. The Fortescue work included two contracts, one for cranes services at FMG Solomon and Solomon Hub, and the other to provide services for subsidiary, The Pilbara Infrastructure. Monadelphous’ contract with BHP involved upgrading a water treatment plant at the Mining Area C iron ore operation in the Pilbara.

NRW Holdings
NRW Holdings’ 2017 went from strength to strength, culminating with gold developer Gascoyne Resources official awarding it with a $324 million mining services contract at the Dalgaranga operation in the Murchison region. The six-year contract is for open pit mining services, as well as drill and blast operations and associated services.

Perth-based NRW reported in August that its participation in the early contractor involvement process at OZ Minerals’ Carrapateena copper-gold project in SA was nearing completion. The $111 million Carrapateena package one contract comprised development of an access road, tailings storage facility, quarry and an airstrip.

NRW also acquired east coast mining services company, Golding Group, for $85 million during the year. As part of NRW, Golding was awarded a mining services contract at Fitzroy Australia Resources’ Broadlea open cut coal mine in Queensland.

To kick-start NRW’s 2017 campaign, lithium developer Altura Mining awarded it with a $110 million contract for mine development and drill and blast services at its Pilgangoora project in February. The five-year contract includes the construction of mining infrastructure, development of mine haul roads, drill and blast services and load and haul production mining of ore and overburden.

RCR Tomlinson
Pilbara Minerals awarded the EPC contract for its Pilgangoora lithium operation to RCR Tomlinson in early 2017. Worth up to $148 million, contract involved the EPC of Pilgangoora’s 2Mt/y lithium-tantalum processing plant, including wet-and-dry circuit with concentrator, associated plant and commissioning of the mine. Pilbara cleared the way for construction to start on the plant in July.

Fortescue awarded RCR with a $33 million contract to design, manufacture and construct a five-kilometre relocatable conveyor system for its iron ore operations in the Pilbara. RCR is leading the design, manufacture and construction of the conveyor system, which will be trialled at Fortescue’s Cloudbreak mine.

Click here for Part 1