Macmahon has been awarded a three-year contract extension worth A$352m ($231.64m) from AngloGold Ashanti Australia to continue mining services at the Boston Shaker underground gold mine in Western Australia.
The contract extension runs through to 1 May 2027. According to the Australia-based mining services provider, it will generate A$117m ($77m) in revenue over the extension period.
Located 330km northeast of Kalgoorlie, the Boston Shaker mine is part of the Tropicana gold operation.
Tropicana is a joint venture (JV) between AngloGold Ashanti and Regis Resources with 70% and 30% interests, respectively. It is said to be one of Australia’s largest producing gold mines.
The Boston Shaker gold mine achieved steady state production of 1.4 million tonnes of ore per year in early 2022.
Once ventilation constraints are resolved at the project, the monthly underground ore production rates will be raised to 175,000 tonnes from 165,000 tonnes.
Macmahon has been responsible for underground mining services at the Boston Shaker gold project since 2019. The mining services contractor will continue to offer services including mine development, cable bolting, production drilling, and ore stoping.
Besides, the company intends to mostly use existing fleet for the period of the extension.
Macmahon CEO and managing director Michael Finnegan said: “We are delighted to have been awarded an extension at Boston Shaker where we have worked to build an excellent relationship with our client, focussed on driving safety and performance outcomes.
“The contract extension award is a critical step toward growing the underground portfolio by 50% over the next two to three years.
“With capital already deployed in the project and no new growth capital required, we expect the extension to enhance our ROACE performance – where we recently increased our target from 15% to 20%.”
