Downer EDI has won a $400 million contract to provide mining services at the Gold Road Resources and Gold Fields-owned Gruyere Gold Project in Western Australia.
Under the five-year deal, Downer will work on construction of infrastructure such as roads and stockpiles, drilling, loading and haulage of ore and waste, run of mine feed and technical services.
Construction will start in the second quarter of 2018, with about 170 people employed, while mining is scheduled to begin in the fourth quarter of the 2018 calendar year.
Downer shares were 12 cents, or 1.8 per cent, higher at $6.98 at 1120 AEDT on Wednesday.
Chief executive Grant Fenn said the contract will build on Downer’s operations in Western Australia, which included work at the Sunrise Dam gold mine and the Roy Hill, Cape Preston and Karara iron ore mines.
“Downer is very pleased to have been awarded this contract and we look forward to working closely with the Gruyere Gold Project team to help them develop this new mine safely and successfully,” Mr Fenn said.
Gruyere is a 50:50 joint venture between ASX-listed Gold Road Resources and New York-listed Gold Fields.
In a joint statement, the companies said Downer was awarded the contract after a six-month consultation with “numerous capable contract mining compaines”.