FMG contracts Decmil for work at Cloudbreak

ASX-listed contractor Decmil Group has secured new work, including at Fortescue Metals Group’s Cloudbreak mine in the Pilbara.

Today, Decmil said it had been awarded with a $4.2 million contract from Fortescue subsidiary Chichester Metals to build five sets of culverts – or tunnels – at Cloudbreak, which forms part of the iron ore major’s Chichester Hub.

Work has already begun and is expected to be completed in November.

Decmil has also been awarded with a further variation to an existing contract with the Victorian government, through which it will design and build crossings in the Murray Goldfields and Goulburn districts.

The contract has been extended by $3.3 million, to $6.2 million.

The awards have boosted Decmil's contracted work-in-hand to about $570 million.

Meanwhile, the Osborne Park-based company says it has reached an interim commercial agreement with the owners of the Sunraysia solar farm in NSW.

Decmil, which was appointed to the project in October 2018, previously claimed it was owed about $14 million from Sunraysia developers Maoneng Australia and John Laing, having escalated the matter late last year.

All parties have agreed to settle the dispute until after the project has been completed (expected in late October).

“Decmil and SSF are to focus on the steps necessary for the above completion and to prepare to implement the operate and maintain phase of the project,” Decmil said.

The business also said it would continue its claims made against subcontractor Schneider, appointed to the project through a supply agreement.

Shares in Decmil remain unchanged today, closing at 36.5 cents per share.