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NRW awarded letter of intent for mining services for Karara Mining Ltd

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Global Mining Review,

NRW Holdings Limited has announced that a letter of intent has been received from Karara Mining Ltd to award a contract for the mining services works at the Karara Iron Ore mine in the Gascoyne region of Western Australia.

Located 200 km south-east of Geraldton in the Shire of Perenjori, Western Australia, Karara is the largest mining operation and the first major magnetite mine in the mid-west. It produces a premium, high-grade concentrate product for export to steelmakers. With an expected mine life of 30+ years, Karara’s operation includes a large opencast mine, complex ore processing, and beneficiation plant and significant infrastructure and logistics networks.

Subject to reaching agreement with Karara, the anticipated value of the contract is approximately AUS$702 million over a 5 year duration with a project workforce averaging around 250 personnel.

The works to be performed include Load & Haul, Drill & Blast and ROM Re-Handling with the drill & blast component to be undertaken by NRW’s wholly owned subsidiary, Action Drill & Blast Pty Ltd.

In addition, the work includes train loading and re-handling of the product stockpiles together with miscellaneous dayworks at the mine-site, camp and access roads.

Procurement of key mining equipment will start immediately after execution of an agreement with Karara and the site mobilisation and establishment will commence during the months leading up to the works commencing on site in March 2022.

NRW estimates an equipment CAPEX of approximately AUS$170 million to be progressively acquired over the term which will include the purchase of three 600 t Face Shovel Excavators and a fleet of 220 t trucks.

NRW CEO, Jules Pemberton, said: “I am delighted that NRW has been selected by Karara as its preferred contractor for mining services. NRW has a long history as a high-quality provider of mining services to our clients in the Iron Ore Industry and I look forward to a long and successful partnership with Karara Mining. With a strong local presence in the area through our Geraldton based DIAB Engineering business and our Mining contract with Gascoyne Resources at the Dalgaranga mine site, we look forward continuing to support the existing and highly experienced workforce on site through this transition, as well as creating employment opportunities for the Gascoyne region community.”

Karara CEO, Changjiang Zhu, added: “NRW is an established West Australian based mining and civil contractor with extensive open cut mining experience gained through a number of successful mining operations in the state. Offering new prime equipment, NRW has the capability to undertake the entire Karara scope of work comprising a broad range of mining, construction and engineering services. We look forward to negotiation of an agreement with NRW and commencement of mining services early next year.”

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Australian mining news Iron ore mining news