Swick wins $50m Newmont contract

Swick Mining Services has been awarded a new underground drilling contract by Newmont Mining, which is expected to generate more than $50 million in revenue for the drilling specialist over three years.

The contract is one of the largest Swick has secured in its history, underpinning the company's revenue for the next three years.

Swick is forecasting a record number of 63 rigs in work across Australia and North America by July 2010.

Under the new contract, Swick will provide underground diamond drilling services to Newmont at the Jundee and Tanami gold mines, starting in April this year for up to a three-year term, with a one year option held by Newmont to extend the contract into a fourth year.

Swick has provided underground diamond drilling services to Newmont at Jundee and Tanami since 2007.

Swick currently has five rigs drilling at Jundee and four rigs drilling at Tanami under the existing contract.

An additional two underground diamond drill rigs will be mobilised to Tanami for the new contract, taking the total Newmont underground diamond fleet from nine rigs to 11 rigs in the short-term.

Swick estimates that the contract will generate in excess of $50 million in revenue over the initial three year term, on the basis of eight rigs in work on a full time equivalent basis throughout the contract tenure.

In addition, Swick is concluding discussions with Newmont in relation to a surface diamond drilling program.

Shares in Swick rose one cent to 44.5c at 13:54 AEDT.