NRW Holdings Ltd (ASX:NWH) has announced its wholly owned subsidiary, Golding Contractors, has executed a limited notice to proceed with Wonbindi Coal and Baralaba Coal Company in respect of the Baralaba North coal project in Queensland. Golding will begin certain preliminary services at commercial rates with the parties, seeking to negotiate outstanding commercial terms for a final binding contract mining agreement. The contract has an estimated value of $350 million.
Golding enters “Limited Notice to Proceed” (LNTP) in respect of Baralaba North coal project
NRW Holdings Limited (ASX:NWH) today announced that its wholly owned subsidiary Golding Contractors Pty Ltd (Golding) has executed a Limited Notice To Proceed with Wonbindi Coal Pty Ltd and Baralaba Coal Company Pty Ltd in respect of the Baralaba North coal project in Queensland.
Pursuant to the LNTP, Golding will immediately commence certain preliminary services at commercial rates with the parties bound to seek to negotiate in good faith the outstanding commercial terms of a final binding contract mining agreement.
If the parties can reach agreement on the terms of a final binding contract mining agreement, the mining contract would have a value of approximately $350M over three years[1].
The general scope of the works includes mine planning; the removal of topsoil; drilling, blasting, loading and hauling overburden; loading and hauling of coal; and handling coal through the crushing and screening plant.
All plant and equipment expected to be utilised to undertake mining will be supplied by the client for the contract duration.
Negotiations regarding the final contract are continuing and are anticipated to be finalised within 35 days of execution of the LNTP (which if agreement has not been reached within 45 days, the LNTP and associated preliminary services automatically terminate). Until a final contract is executed, there can be no guarantee that the contract will be awarded. NWH will update the market as to any material development.
Jules Pemberton, Managing Director and CEO of NRW Holdings said “This is a great opportunity for Golding to add another full mine operation contract to its portfolio”.
Geoff Caton, CEO of Golding said “. Our team is ready and looking forward to working with Wonbindi to recommence mining operations at Baralaba North Mine.”
[1] The estimated contract value and term is based on NWH assessment given the status of the negotiation of the contract mining agreement as at the date of the execution of the LNTP (including scope of work, costings and estimated pricing). As those negotiations remains ongoing, the final contract value may differ materially from these numbers (if an agreement is reached at all). Accordingly, this value is an uncertain indicator of future earnings.
