Perenti Limited subsidiary African Mining Services (AMS) has secured a US$235 million open pit mining services contract for Sandfire Resources‘ A4 open pit within the Motheo Copper Mine.
AMS will provide all surface mining services related to development and production activities at the A4 open pit under the terms of the contract. The A4 open pit is around 8 kilometres west of the Sandfire’s existing T3 open pit, where AMS has successfully proceeded from development to production works. Perenti expects that A4 pre-production and development work will begin in September 2023, followed by pre-strip mining in October 2023.
The T3 and A4 open pits will be integrated into a larger operation, leveraging scale and operational synergies to optimise return on capital. Primary synergies include optimising existing infrastructure, mining equipment, maintenance facilities, and technical and operational management. Perenti’s FY24 guidance considers these synergies and capital efficiencies, including A4 revenue and earnings.
“We are excited about the opportunity to expand our partnership with Sandfire Resources. Motheo is a long-life asset in the Kalahari Copper belt, and the expansion of our role here is in keeping with our strategy of disciplined growth within top-tier mining jurisdictions with high quality partners. Sandfire is now one of our largest clients and over the term of the combined contracts, the T3 and A4 open pits are expected to generate total revenue of over A$1.1 billion, delivering strong returns for Perenti and its shareholders,” Perenti Managing Director and Chief Executive Officer Mark Norwell said.
“Since Barminco commenced operations in 2019 and AMS later in 2021, Perenti has established itself as the leading international mining contractor in the Kalahari Copper belt. With the award of our third mine in the region, we look forward to playing our part in Sandfire’s expansion of their world class Motheo Copper Mine. Beyond this, I am proud of the contribution Barminco, AMS and Perenti continue to make to the development of Botswana’s mining industry and the community more broadly,” Contract Mining President Paul Muller stated.
