Clough awarded Rio power contract

The collapse of Forge Group has opened up new opportunities for engineering contractor Clough, which has won a design and procurement contract for a power station that was previously awarded to Forge.

Clough will provide engineering, detailed design and procurement services for the 130 megawatt power station that Rio Tinto is developing at its Cape Lambert port facility.

The value of the contract was not disclosed.

In September 2012, Forge was awarded a $280 million contract for the engineering, procurement and construction of the same power station.

Forge and its subsidiary CTEC had dominated the power station construction market in Western Australia before its collapse in February, having been awarded four contracts in recent years.

The most recent win, announced in December 2012, was for construction of the power blocks at BHP Billiton’s 190MW Yarnima power station in Port Hedland. That contract was worth $100 million.

Forge was placed into administration after running into problems on two other power station projects - Diamantina in Queensland, and West Angelas in WA.

Clough was previously a major shareholder and joint venture partner with Forge.

Clough’s Executive Vice President, Oil & Gas Australia & PNG, Max Bergomi said Clough would draw on extensive value improvement expertise to optimise the cost outcomes for the Rio project, expected to be completed over a 12 month period.

The new power station is part of a multi-billion dollar expansion of Rio’s Cape Lambert facilities, expected to increase its Pilbara export capacity to 360 million tonnes of iron ore annually.