NRW Holdings Limited (ASX: NWH) has announced that its wholly owned subsidiary, Golding Contractors, has reached agreement with Stanmore Coal (ASX: SMR) to increase overburden removal capacity with the addition of a third truck and excavator fleet.
NRW Holdings Limited (ASX: NWH) has announced that its wholly owned subsidiary, Golding Contractors, has reached agreement with Stanmore Coal (ASX: SMR) to increase overburden removal capacity with the addition of a third truck and excavator fleet.
During the fiscal year 2019 the mine has continued to increase production. The new contract mine plan is seeking to sustain current coal production volumes of circa 3 Million ROM tonnes per annum.
The third fleet will commence in August 2019 with Golding supplying an additional Hitachi EX3600 excavator, 5 EH3500 Hitachi trucks and the remainder of the ancillary fleet, the majority of which will be mobilised from NRW’s Middlemount project. The 5 EH3500 trucks will be replaced by 5 EH4000 Hitachi trucks as they become available from the Middlemount project.
Stanmore Coal will also supply a new Caterpillar 6060 excavator expected to be commissioned later in the calendar year, which Golding will also operate and maintain. The value of the increase in scope of the contract adds approximately $450M to the existing 5 year contract.
The total contract sum is estimated to be approximately $950M at the current mine production levels.
NRW CEO and Managing Director Jules Pemberton said, “This amendment is built on the back of a productive relationship and a positive transition for both Stanmore and Golding to the Isaac Plains East operations.
“We expect our capital commitment to be very low at around $10 million as we are able to utilise fleet secured through an agreed early release from the Middlemount Coal contract.
“The Middlemount contract is not formally due for completion until the end of FY20 however we will be able to release certain fleet prior to that date and some fleet will also likely remain on site beyond the formal contract end date.
“As the Middlemount project is a maintained dry hire contract, the release of our fleet will enable us to re commit these assets to existing and new full-service contract mining opportunities in line with our mining divisions delivery model.”
The overall increase in revenue at Isaac Plains from FY21 onwards compared to the previously contracted annual revenue fully offsets the reduction in revenue at Middlemount when the current contract completes at the end of FY20.
