Watpac Civil & Mining has won a $17 million contract to provide mining services to Ramelius Resources’ Kathleen Valley gold project near Leinster.
Watpac Civil & Mining has won a $17 million contract to provide mining services to Ramelius Resources’ Kathleen Valley gold project near Leinster.
Watpac will undertake surface mining works including topsoil removal, load, haul, drill, blast and dewatering operations for the project, which received the final outstanding statutory approval for commencement last week.
Mining will be carried out at the project’s Mossbecker and Yellow Astor pits, where Watpac has been contracted to work over a 12-month period.
“This is Watpac’s third project with Ramelius, and is testament to our approach of working closely with our clients to maximise their production and cost efficiencies," managing director Martin Munro said.
“We have a highly capable and dedicated team in our mining and civil business and believe Watpac can continue to operate successfully in this market notwithstanding the current challenging conditions.”
General manager mining and civil, Russell Hall, said Watpac had been undertaking mining services works at Ramelius’ Mt Magnet gold mine since 2011, and also delivered the Coogee open pit project for the company last year.
In a statement, Ramelius said Watpac would begin mobilisation to the site immediately, while open pit mining was expected to begin in July.
First ore is expected to be trucked to the Checker mill at Mt Magnet later in the September quarter.
The Kathleen Valley project will have an initial life of 1.5 years and has a mineral resource of 163,000 ounces of gold at an all-in sustaining cost of $936/oz.
“As planned, a key element of our production strategy has fallen into place with final approvals received from the relevant authorities, allowing project commencement in the current June quarter,” Ramelius chief executive Mark Zeptner said.
“In the current environment, it is pleasing to be able to kick off a new project with the associated employment and royalty benefits for the state, as well as the strong early cashflows that a high grade, low cost gold project like Kathleen Valley will deliver.”
Watpac shares rose 3.1 per cent to 81 cents a share at 2pm.
Ramelius shares were unchanged at 13 cents a share.