- Release Date: 07/02/12 10:30
- Summary: GENERAL: DOW: Downer awarded $570 million mining contract
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DOW 07/02/2012 08:30 GENERAL REL: 0830 HRS Downer EDI Limited GENERAL: DOW: Downer awarded $570 million mining contract Media/ASX and NZX Release 6 February 2012 DOWNER AWARDED $570 MILLION MINING CONTRACT Downer EDI Limited (Downer) today announced it has been awarded a six year magnetite mining contract with Karara Mining Limited (KML) for the provision of services at the Karara Iron Ore Project in Western Australia. KML is an incorporated joint venture between Gindalbie Metals Limited and Anshan Iron & Steel Group Corporation (AnSteel), China's second largest steel producer. The contract commences this month and has total estimated revenue of approximately $570 million over the six year contract term. It is a fixed and variable schedule of rates contract which includes a rise and fall mechanism for changes in cost. Downer will establish the mine infrastructure and provide services including drill and blast, and load and haul of waste and ore. New capital expenditure required for the project will be approximately $92 million. This will be funded primarily through operating cash flow and new finance and operating leases. Approximately $41 million of capital expenditure will be required in the 2012 financial year. This amount was included in the capital outlook budget of $400 million provided as part of Downer's 2011 full year results announcement. The Chief Executive Officer of Downer, Grant Fenn, said the contract would enhance Downer Mining's exposure to the expanding iron ore sector and also increase its geographical presence in Western Australia. "We look forward to working with Karara Mining over the next six years to deliver this critical component of the Karara Iron Ore Project," Mr Fenn said. For further information please contact: Michael Sharp, Group Head of Corporate Affairs and Investor Relations +61 439 470145 Luke Thrum, Manager Investor Relations +61 459 828720 Downer EDI Limited (www.downergroup.com) provides comprehensive engineering and infrastructure management services to the public and private Minerals & Metals, Oil & Gas, Power, Transport Infrastructure, Communications, Water and Property sectors across Australia, New Zealand, the Asia Pacific region and the United Kingdom. End CA:00219211 For:DOW Type:GENERAL Time:2012-02-07 08:30:38
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