Newmont Mining has awarded WorleyParsons an engineering and construction contract for its Tanami gold project, where it is evaluating investment of up to $US750 million ($A1 billion).
Worley announced today it has been awarded a four-year engineering, procurement and construction management (EPCM) contract by Newmont.
It said the contract includes establishing a deep shaft and related mining infrastructure to lift production at the Tanami mine in the Northern Territory.
Business News understands the contract relates to preparatory work for the expansion, as Newmont has not committed to the project.
Newmont’s most recent update in December said it was continuing to advance studies for a second expansion at Tanami and expected to reach a full-funds decision in the second half of 2019.
Tanami is the second largest underground gold mine in Australia with production last year of 419,000 ounces.
A $120 million upgrade completed in 2017 lifted processing capacity to 2.6 million tonnes of ore, and the proposed stage 2 upgrade will be designed to lift that to 3.2 million tonnes.
A Newmont investor presentation in November said the stage 2 expansion was designed to enable profitable extraction of ounces at depth.
It would include a 1,460 metre hoisting shaft and supporting infrastructure to underpin higher production.
The Newmont presentation said the expansion would entail a staged investment of between $US650 million and $US750 million.
It would be designed to add 100,000oz pa to gold production and reduce operating costs by about 10 per cent.
As well as Tanami, Newmont operates the Boddington and Super Pit gold mines in WA.
Australian production is expected to be 1.5 million oz in 2019 with higher grades and throughput and productivity gains at Tanami, offset by lower mining rates at the Super Pit following last year’s wall slips and the continuation of stripping at Boddington.
