Downer wins $400m mining services contract at Gruyere gold project

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

The five-year contract at the Eastern Goldfields site will involve 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.

Downer, which will have a peak workforce at Gruyere of around 170 people, plans to launch construction of the operation in early 2018. Mining is scheduled to start in the December 2018 quarter.

The Gruyere JV explained that Downer was awarded the contract based on its price competitiveness, relevant experience on technically similar projects, and demonstrated leadership in safety, environmental stewardship and community engagement.

Gruyere JV general manager Steve Price said the award of the contract was the result of six months work that involved numerous capable contract mining companies.

“Downer was selected as the preferred business partner for the project as they led all facets of the key criteria set for the award of the mining contract,” Price said.

Gold Road, which discovered the greenfields project close to the Northern Territory border, formed the JV with South Africa’s Gold Fields in November last year. The mining services contract value is in line with the cost estimate in the Gruyere feasibility study, the JV added.

Gruyere’s mining activities will involve a fleet of 225-tonne payload dump trucks, 400-tonne excavators, production blasthole drills and support equipment to move around 31 million tonnes (Mt) of material a year.

Downer chief executive officer Grant Fenn said the contractor was looking forward to working closely with the Gruyere project team to help develop the new mine.

“It will also build on our extensive operations in Western Australia, which includes providing mining services at the nearby Sunrise Dam gold mine as well as at Roy Hill, Cape Preston and Karara iron ore mines,” Fenn said.

Downer announced earlier this week that it had parted ways with Adani as the major contractor on the Carmichael coal project in the Galilee Basin of Queensland.

The Gruyere contract, as well as the recent $312 million joint venture contract win with Ausenco at OZ Minerals’ Carrapateena copper-gold project in South Australia, will help Downer offset the loss of the Adani agreements.