13/06/2017 - 10:44

Monadelphous wins $125m in new work

13/06/2017 - 10:44

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Monadelphous Group has won a contract to complete cryogenic tanks at the Ichthys LNG project in Darwin – the same job that Laing O’Rourke walked away from in March.

Monadelphous wins $125m in new work
The Ichthys LNG project in Darwin.

Monadelphous Group has won a contract to complete cryogenic tanks at the Ichthys LNG project in Darwin – the same job that Laing O’Rourke walked away from in March.

The Burswood-based company said today it had been awarded a subcontract by Japan's Kawasaki Heavy Industries for structural, mechanical, piping, electrical and instrumentation work on the cryogenic tanks at Ichthys’s onshore LNG facilities.

The work was previously being carried out by engineering contractor Laing O’Rourke and was in its final stages until Laing walked off the job in March, claiming it hadn’t been paid in months for the work by Kawasaki.

The subcontract win follows news last month that Monadelphous had secured offshore maintenance services work at Ichthys for an undisclosed sum.

“We are particularly pleased to have secured further works at Ichthys, which underlines our strong performance to date on this project,” managing director Rob Velletri said.

Monadelphous also announced it had secured a new contract for the supply of structural steel, fabricated spooling and pre-assembled modular pipe racks for Texas-headquartered Jacobs, as part of a plant expansion project in the US.

The company said it has also secured four new contracts in the water industry, one in Australia and three in New Zealand.

The Australian contract was for the provision of civil, structural, mechanical and electrical work to the Townsville City Council for upgrades to the Cleveland Bay purification plant.

Meanwhile, the disputre between Laing O'Rourke and Kawasaki is playing out in the courts, with Laing having a win last month.

The Supreme Court of NSW granted an injunction preventing Kawasaki from calling on about $49 million of Laing’s performance bonds, with law firm Squire Patton Boggs partner Cris Cureton calling it an important step in protecting Laing’s position.

“We believe this to be one of the largest injunctions restraining a call on bonds in terms of quantum ever in Australia. It reflects the immensity of what is at stake here,” he said.

“The risks to contractors posed by these massive energy and resources projects cannot be underestimated; so much of their capital, infrastructure and human resources are tied up that any delay in payment or the works can have very prejudicial impacts.

“We are thrilled to have achieved this important step in protecting Laing O’Rourke’s position.”

Monadelphous shares were 1.9 per cent higher to $13.79 each at 10:20am.

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