THE buoyant state of the global mining industry has provided more good news for Perth-based company GRD, which has picked up several major new contracts.
THE buoyant state of the global mining industry has provided more good news for Perth-based company GRD, which has picked up several major new contracts.
In the past three weeks, its engineering subsidiary GRD Minproc has been awarded definitive feasibility study contracts for projects with a capital value of $1.9 billion.
Its clients include mining giant BHP Billiton, nickel producer Minara Resources, aspiring uranium miner Paladin Resources and Brazilian miner CVRD.
As well as the new contracts, GRD Minproc is continuing definitive feasibility studies for other projects with a capital value of $700 million.
GRD chairman Brettney Fogarty said the company had built up the number and capability of its people, enabling it to respond to the increased level of work.
“This further strengthens GRD’s resource contracting project pipeline and should contribute to higher core earnings over the next two years as the studies flow through to construction projects,” he said.
Higher earnings would be welcomed by shareholders, since GRD Minproc has been an underperfomer in recent years.
It posted a small pre-tax profit of $3.3 million in the year to December 2003, up from a loss of $3.4 million in 2002.
GRD Minproc chief executive Dario Amara said the recent contract wins “highlight GRD’s position as a leading international resource contractor”.
He said the company had a history of converting 70 per cent of its studies to projects within two years.
Presently, the company has 53 studies underway, split evenly between Australia and offshore.
The recently awarded definitive feasibility study contracts include an assessment of a fifth autoclave at Minara Resources’ Murrin Murrin nickel project.
It has also been working on BHP Billiton’s Goldsworthy iron ore extension project and a nickel project for CVRD in Brazil.
The feasibility studies are additional to GRD Minproc’s $1.3 billion order book, up from $500 million just two months ago.
The biggest boost to its order book came from the recent go-ahead of BHP Billiton’s $1.4 billion Ravensthorpe nickel project.
A joint venture between GRD and Canadian company Hatch was awarded the engineering, procurement and construction management contract for the Western Australian portion of the project, which is understood to account for about three quarters of the total capital spend.
GRD Minproc’s other ongoing projects include Newcrest’s Telfer gold mine in the Pilbara, in joint venture with Hatch and Lycopodium, and the Kansanshi copper project in Zambia.
It is also building a waste processing plant in Sydney for Global Renewables, another GRD subsidiary.
GRD shares are currently trading around $1.70, following a strong rise last year to a high of $2.12.
