Pilbara Minerals' Pilgangoora lithium project south of Port Hedland.

RCR wins $148m Pilgangoora contract

Wednesday, 18 January, 2017 - 10:32

Pilbara Minerals has awarded a $148 million contract to RCR Tomlinson for the engineering, procurement and construction of processing facilities at its Pilgangoora lithium project south of Port Hedland.

RCR said in a statement today it had received the EPC contract, with the bulk of the work to be carried out subject to Pilbara completing a final investment decision on the project, due early March.

The contract contains an incentivised target cost of $138 million with a guaranteed maximum price of $148 million. 

The contract excludes RCR procuring several long-lead items for the processing plant, as Pilbara sourced these materials itself in October.

The overall project is estimated to cost $184 million.

RCR’s scope of work includes construction of the 2 million tonnes per annum processing plant, including a wet and dry circuit with a concentrator, associated plant and commissioning work.

The contractor will immediately begin work on the first stage of the contract, front-end engineering and design work, which is worth $10.3 million.

Stage 2 of the project is expected to begin in May.

First production at the processing plant is scheduled for the first quarter of next year.

To support the project, RCR has engaged Minnovo and Primero Group as subcontractors for the job.

“This contract award is a result of our intelligent engineering approach to providing an industry leading technical solution to Pilbara Minerals,” RCR managing director Paul Dalgleish said.

“This win firmly places RCR as a market leader in the engineering, procurement and construction of mineral processing plants in the mining and minerals sector.

“It will also increase RCR’s order book to a new record high of about $1.1 billion.”

Pilbara also awarded a $4.8 million contract to Perth-based Veris (previously known as Otoc) for the provision of reestablishment works for the first stage of the 300-room camp at Pilgangoora.

Veris will de-construct, transport, erect, commission and handover an initial 60 rooms plus common facilities under the contract.

The camp was purchased from Roy Hill late last year.

RCR shares were 1.2 per cent higher to $2.86 each at 10:30am, while Pilbara shares were 1.2 per cent higher to 55.2 cents each.