08/04/2008 - 09:15

Moly contract awarded to WorleyParsons

08/04/2008 - 09:15

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West Perth-based Moly Mines Ltd has announced the completion of the engineering, procurement and construction management (EPCM) contract with WorleyParsons for its 20 million tonne per annum Spinifex Ridge Molybdenum Project.

West Perth-based Moly Mines Ltd has announced the completion of the engineering, procurement and construction management (EPCM) contract with WorleyParsons for its 20 million tonne per annum Spinifex Ridge Molybdenum Project.

The estimated value of the reimbursable contract will be approximately A$100m and is based on the Project proceeding as currently planned, including the Company finalising its project finance.

The EPCM Contract is a cornerstone contract and yet another major milestone for the development of the Spinifex Ridge Project.

This prime contract for the construction of the Project concentrator formalises the delivery structure and contracting approach for the Project.

The EPCM Contract includes an incentive based compensation scheme that will reward WorleyParsons for meeting key project milestones through to the Project's scheduled Practical Completion.

The milestones are based on performance in key areas including safety, scheduling, commitments, budget and cost.

WorleyParsons' association with the Project extends back to the initial pre-feasibility study work that commenced in 2005.

WorleyParsons is an ASX listed company which has 27,000 employees world wide in 34 countries and is a leading professional services provider to the energy and resources sector particularly in Western Australia.

The Company continues to work closely with its advisors to bring a financial close to the Spinifex Ridge Project and is well advanced with financing documentation which will facilitate a rapid financing process.

The Company is pleased to report the continuing progress with Project activities with gas and power contracts under negotiation and is targeting to have 50% by value of the capital cost of the Project under contract by May 31.

This initiative will further de-risk both the mine construction and Project financing.

Environmental approval under Part IV of the EPA Act remains outstanding and it is currently anticipated this will be received during June 2008.

The Australian equity capital markets have recently been affected by the collapse of the Australian margin lending and stock broking firm Opes Prime.

It is understood that the collapse has affected over 700 ASX listed companies.

The Company has carried out investigations into the exposure of its directors and other related parties to the margin lending facilities with Opes Prime and advises that one of its directors has a parcel of 100,000 shares (representing only 0.1% of the Company's existing issued capital) that has been affected by the receivership.

No other director or related party is impacted.

In regard to the "Companies Update" released by ASIC and ASX on 29 February 2008, Moly Mines does not consider that this holding requires disclosure under ASX Listing Rule 3.1.

The directors of the Company have informed the Company that they do not have any margin lending facilities with any lender over their holdings in the Company.

In addition, following enquiries the Company is not aware of any other person who may currently have a material holding subject to the margin lending facilities operated by Opes Prime.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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