Macmahon Holdings has won a $US500 million contract, in joint venture with Germany’s Operta, for coal mining services at the Tavan Tolgoi mine in Mongolia.
The five-year contract with the state-owned operator of the mine, Erdenes Tavan Tolgoi JSC, was signed yesterday.
Mining will commence in January under the deal, with an initial three million tonnes per annum production targeted.
Production is expected to ramp up to six million tonnes in the mine’s second year, eventually increasing to 15 million tonnes per annum once the entire operation and transport infrastructure is established.
Macmahon chief executive Nick Bowen said the project placed Macmahon at the forefront of one of the world’s largest emerging mining regions.
“This is an enormous opportunity in a market with great potential and is a big step forward in Macmahon’s international expansion,” Mr Bowen said in a statement.
“Our operations in Mongolia pave the way for developing a long-term business in the region and will see our world-class mining expertise on show through this project.”
At close of trade today, Macmahon’s stock was steady at 63 cents.
