Listed contractor Perenti’s underground mining division Barminco has secured a $300 million contract from Ramelius Resources at its newly acquired Dalgaranga gold asset.
Listed contractor Perenti’s underground mining division Barminco has secured a $300 million contract from Ramelius Resources at its newly acquired Dalgaranga gold asset.
Barminco will undertake underground mining services at what was Spartan Resources’ flagship gold project prior to Ramelius’ $2.4 billion acquisition completed in July.
Spartan had run an aggressive regional exploration campaign for Dalgaranga - a 2.8-million-ounce asset located 80km northwest of Mount Magnet - in the lead-up to the major gold sector deal.
Dalgaranga was once a producing open-pit mine and has processing infrastructure on site, but Ramelius plans to haul ore from an unground operation to its Mount Magnet operations under its bid to lift production to 500,000 gold ounces by the FY30.
Under the contract announced on Thursday, Barminco will provide underground development, production and mining services across a four-year term, with a 12-month option to extend.
It will require the contractor to spend $16 million in growth capital this financial year, which Perenti said was included in its guidance forecast.
Barminco’s $300 million contract was awarded after an underground exploration decline at the project, which will now be used to support production and further development.
Perenti’s president of contract mining Gabrielle Iwanow said the longer-term contract was validation of the high-quality work that has been completed at Dalgaranga to date.
“I look forward to the Barminco team continuing to deliver safe and reliable production for Ramelius for years ahead,” she told the market.
The contract builds on Barminco’s recent string of wins in the gold sector, the latest being $200 million worth of work at Westgold Resources’ Great Fingall project near Cue.
Barminco also secured a $500 million deal to extend underground mining operations at Gold Fields’ Agnew gold hub back in June.
“Several recent regional contract wins have built additional scale for the Barminco Australia business, which ultimately delivers benefits for both our clients and shareholders,” Perenti managing director Mark Norwell said.
“The Dalgaranga project will further support our Australian earnings and sustainable cash generation.”
Shares in Perenti last changed hands at $2.50 a pop, up about 4 per cent at 1PM AWST.
