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- 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
(20min delay)