‘Boomerang’ contracts bring work back home

BASSENDEAN firm Specialised Welding is one of many local firms to have worked on Woodside’s $1.6 billion Train Four project.

However, its client was not Woodside. Instead it was the Japanese pump manufacturer Nikisso.

Specialised Welding’s $300,000 contract with Nikisso was a small example of the “boomerang” contracts that project proponents are now trying to encourage.

These contracts apply in cases where overseas firms win work on Australian projects.

In the past, the overseas firms would typically deal with fabricators and other suppliers in their home market.

Now they are encouraged to identify competitive Australian suppliers that can do the work instead.

This policy is one aspect of the Australian Industry Participation Plans that project proponents prepare.

The role of the AIP Plan is to explain the strategies that will be used to maximise Australian content on big projects.

The ability of local firms to compete for these contracts is helped by the logistics of major projects.

For instance, the stainless steel pressure vessels manufactured by Specialised Welding were sent straight from Perth to the Burrup Peninsula.

Specialised Welding managing director Trevor Robinson said the company was helped by its experience in the export market, where its success was underpinned by a reputation for quality workmanship.

It has previously worked for Japanese companies involved in projects in South East Asia.

Only a handful of “boomerang” contracts have been awarded to date.

Other beneficiaries include United KG (in Perth) and Downer Engineering (in Melbourne), which won contracts with Italian compressor manufacturer Nuovo Pignone.

Downer manufactured acoustic panels and enclosures to house the Train Four compressors.

Rio Tinto is applying this policy to its $400 million HIsmelt project in Kwinana.

It said that German company Oschatz, which last year was awarded contracts worth $18 million for offgas hoods and a heat recovery unit, has been encouraged to seek fabrication contracts locally.

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