• Preferred contractor for $420 million Karlawinda Gold contract in WA
  • Preferred contractor for $220 million Kirkalocka Gold contract in WA

WA-based mining contractor SMS Mining Services has been announced as the preferred contractor for the $420 million mining contract at Capricorn Metals Ltd’s (ASX: CMM) Karlawinda Gold Project near Newman, and the $220 million mining contract at Adaman Resources’ Kirkalocka Gold Project near Mt Magnet.

SMS managing director Danny Sweeney said: “These contracts are transformational for SMS. We now have an order book exceeding $1 billion, contracts in the pipeline extending out to 2027, and a remaining tender pipeline of over $1.2 billion.

“This demonstrates the confidence in the SMS business model which delivers a flexible and fully integrated service offering from rental and maintenance through to contract mining.”

Karlawinda Gold contract

The 8 year and 10 month contract represents the entire life of mine and will consist of open pit mining services including load and haul, drill and blast, and mine development.

The project will generate approximately $420 million in revenue for SMS over the contract period and have a peak workforce of up to 145 personnel.

SMS will mobilise new and existing equipment, and deploy significant technology and operational initiatives.

“We are excited to be part of Capricorn Metals story. We look forward to forging a successful long-term partnership and supporting the company in bringing the Karlawinda Gold Project into production in 2019,” said Mr Sweeney.

Formal contract award is subject to final contract negotiations which SMS expects to finalise in the coming months. Contract works are due to start in the second quarter of 2019.

Kirkalocka Gold contract

The company has further added to its success by announcing its preferred contractor status for the $220 million mining contract at Adaman Resources’ Kirkalocka Gold Project located 70km south of Mount Magnet, WA.

SMS owns a 33% stake in privately-owned Adaman Resources as part of its productive equity strategy of supporting small and mid-tier miners to enter production.

The four year contract with an option to extend will consist of open pit mining services including load and haul, drill and blast, and mine development. Drilling is currently is underway to extend the open pit mine life beyond the current six year life.

The project will generate approximately $220 million in revenue over the contract period and have a peak workforce of up to 115 personnel.

Formal contract award is subject to final contract negotiations which SMS expects to finalise in the coming weeks. Contract works are due to start late 2018.