Downer EDI wins Roy Hill iron ore project

Image credit: User: Yoav Lerman

Engineering group Downer EDI has won a $500 million contract with mining magnate Gina Rinehart’s Roy Hill iron ore project, according to an AAP report published via Yahoo news.

Image credit: User:  Yoav Lerman
Image credit: User: Yoav Lerman

The company will reportedly be employing over 220 people over the span of four years as it performs mining activity at Hancock Prospecting’s open cut mine in the Pilbara region in Western Australia.

Construction work is expected to begin during the first months of 2014, while full-scale mining operations are planned to start by the end of next year.

Up to $110 million will be spent on capital for new equipment during the 2014/15 financial year.

According to the Downer EDI’s media release, the company will be performing pre-strip and supplementary mining activity over the initial years while Roy Hill will be predominantly undertaking mining on an owner-operator basis.

The contract is expected to be executed by the end of November and is valued at approximately $500 million.

The services to be provided under the terms of the contract include drill and blast and load and haul of overburden and ore.

The project is expected to involve a fleet of 18 haul trucks and two excavators, with the capital required approximated at $110 million.  $40 million are set aside for new equipment and $70 million are provided from existing equipment.

The company reveals that the capital will be spent during the course of 2015 financial year.

Chief Executive Officer of Downer, Grant Fenn, said Downer EDI received the notice of award based on its strong capabilities, comprehensive services and its expanding presence in Western Australia.

Downer EDI Limited (Downer) is a leading provider of engineering and infrastructure management services to customers operating in market sectors including Minerals & Metals, Oil & Gas, Power, Road & Rail Infrastructure, Telecommunications and Water. It is listed on the Australian Securities Exchange and employs more than 20,000 people in Australia, New Zealand and the Asia Pacific region.