Capricorn Metals and Adaman Resources have named SMS Mining Services as the preferred contractor for their gold projects in Western Australia.
The proposed contracts are worth a combined $640 million and would push SMS’s order book to beyond $1 billion.
Capricorn has selected SMS as the preferred mining services provider for a $420 million contract that covers the entire life of mine at the Karlawinda gold project in the Pilbara.
Karlawinda is being developed into a 100,000 ounce a year operation, with first production targeted at the site in mid-2019.
The eight-year, 10-month contract will consist of open pit mining services, including load and haul, drill and blast, and mine development.
SMS will mobilise new and existing equipment, and deploy significant technology and operational initiatives at Karlawinda. Its operations will require a peak workforce of up to 145 personnel.
The company expects to finalise the contract with Capricorn in the coming months, with works due to start in the second quarter of 2019.
SMS also secured preferred status for a $220 million mining contract at Adaman’s Kirkalocka project near Mt Magnet.
The four-year contract, with an option to extend, will consist of open pit mining services, including load and haul, drill and blast, and mine development. It will require a peak workforce of up to 115 workers.
SMS expects to finalise the Kirkalocka contract in the coming weeks, with works scheduled to start in late 2018.
The contractor owns a 33 per cent stake in privately-owned Adaman as part of a ‘productive equity strategy’ of supporting small and mid-tier miners to enter production.
SMS managing director Danny Sweeney described the contracts as transformational for the company.
“We now have an order book exceeding $1 billion, contracts in the pipeline extending out to 2027, and a remaining tender pipeline of over $1.2 billion,” Sweeney said.
“This demonstrates the confidence in the SMS business model which delivers a flexible and fully integrated service offering from rental and maintenance through to contract mining.”
Sweeney added that SMS was looking forward to supporting Capricorn as it brought the Karlawinda project into production next year.