Works under the five-year contract expected to begin in 2022

Karara-Mining

NRW selected as preferred contractor for mining services for the Karara Iron Ore mine. (Credit: NRW Holdings)

NRW is set to win a mining services contract worth around AUD702m ($526.84m) from Karara Mining for the Karara Iron Ore mine in Western Australia.

The company has been issued a letter of intent (LoI) in this regard for the five-year contract, which would involve the deployment of 250 personnel from NRW. The contract award is subject to reaching an agreement with Karara Mining, a joint venture between China’s Ansteel Group and Gindalbie Metals.

Located in the Gascoyne region, 200km south-east of Geraldton in the Shire of Perenjori, the Karara Iron Ore mine was opened in 2010.

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.”

The scope of the contract includes load and haul, drill and blast, and rom re-handling. The drill and blast component will be carried out by NRW’s fully-owned subsidiary – Action Drill & Blast.

Apart from that, NRW will be responsible for train loading and rehandling of the product stockpiles alongside miscellaneous dayworks at the mine-site, camp, and access roads.

NRW said that procurement of important mining equipment will begin immediately after signing an agreement with Karara Mining. Following this, site mobilisation and establishment will begin during the months leading up to the works beginning on site in March 2022, said the contractor.

The company has projected an equipment Capex of around AUD170m ($127.58m). The equipment will include three 600 tonne Face Shovel Excavators and a fleet of 220 tonne trucks to be purchased by the company.

Karara Mining CEO Changjiang Zhu said: “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.”