Perenti boosts order book by $235m

Perth-based mining contractor Perenti has secured further work through its African subsidiary under a two-year contract with AngloGold Ashanti.

Perenti, through African Underground Mining Services (AUMS), will continue operations at AngloGold’s Geita mine in Tanzania with immediate effect, which is expected to boost Perenti’s current work in hand by $US186 million (about $A235 million).

As part of that contract, Perenti will transfer 20 per cent of equity to AUMS Tanzania to create a new mining support services company called BG Umoja Services.

BG Umoja will support the Geita operations through an 80:20 joint venture between the Perenti group of companies – including AUMS, which is part of Barminco – and local business Geofields Tanzania.

Perenti’s contract extension also includes the development of a new underground mine, called Geita Hill, which managing director Mark Norwell said would increase the company’s scope of works and revenue in 2021.

Its mining executive, Paul Muller, said Perenti would also have an opportunity to partner with numerous local businesses, suppliers, and contractors.

The company had first begun mining in Tanzania in the late 1990s.

Geita, which has a mineral resource of 6.25 million ounces, is located in the country’s north-west and is one of AngloGold’s flagship assets.

It has operated as a large-scale mine since the 1930s and as a multiple open-pit and underground operation since 2016.

“This contract extension is expected to generate an improved earnings contribution for Perenti over the contract term,” Mr Norwell said.

“Winning new contracts and extending existing contracts is one of our key strategic priorities and we continue to make great progress on the execution and delivery of our 2025 strategy.”

That strategy, announced in March 2019, is aimed at delivering strategic growth for the business and a technology driven future, among other key pillars.

Shares in Perenti were down 1.3 per cent at 12:43pm AEST to trade at $1.12.