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Mining recovery boosts CIMIC performance with new contracts

Global contractor CIMIC has used improving market conditions in mining and minerals processing to help increase its 2017 profits by 21 per cent.

The diversified company’s mining and minerals processing divisions — Thiess and Sedgman — achieved growth last year, CIMIC reported, securing contracts and extensions in Australia and Indonesia, including an extension at the Fortescue Metals Group’s Solomon Hub iron ore operation in the Pilbara of Western Australia.

This performance in mining and minerals processing helped CIMIC deliver $702 million in profits for the year, which was just above its $640–700 million guidance.

CIMIC also strengthened its position in the construction industry with several new contracts, both in Australia and internationally.

Michael Wright, CIMIC chief executive officer, said the company leveraged its competitive position and favourable market conditions to produce the operating performance and further diversify an order book across mining, construction, services and public private partnerships.

“We increased our focus on the development of our people during the year, and will further this in 2018 to ensure our performance-based culture provides long-term, rewarding career for our people,” Wright said.

CIMIC secured $18.4 billion worth of new work in 2017, including the $650 million contract extension at the Solomon Hub.

Also in mining, the BHP Mitsubishi Alliance (BMA) awarded Thiess two contracts worth a combined $440 million at the Caval Ridge and Peak Downs coal mines in the Bowen Basin of Queensland.

Thiess was also awarded a $189 million contract extension to continue to operate the Jellinbah Plains open pit at the Jellinbah East coal mine in central Queensland.

Sedgman’s contract wins included a $107 million EPC contract at Heron Resources’ Woodlawn zinc-copper project in New South wales, a $6 million EPC contract with Stanwell Corp at the Meandu mine coal handling and preparation plant in Queensland, and contracts worth a combined $100 million at QCoal Group’s Byerwen coal mine in Queensland.

Elliott Management renews calls for BHP restructure

February 6, 2018News Ewen Hosie

It is a view that the company’s chief executive officer Andrew Mackenzie has disagreed with in the past. The CEO said late last year that costs would probably outweigh the benefits, and estimated a cost of $1.3 billion.

According to Elliott’s report, however, which was created under commission by FTI Consulting, reorganising BHP’s head operations into a single Australian entity would cost only $391 million.

BHP’s dual-listed structure, a result of the 2001 merger between the Australian half of BHP and the UK half of Billiton, means BHP Billiton as a whole has two HQs (Melbourne and London) and two market listings, but a single management and board.

FTI’s study stated that restructuring into single listing could result in a $14.1 billion increase in market valuation and a return of $8.7 billion through improved tax credit efficiency.

Komatsu acquires Queensland based mine solutions provider MineWare

Komatsu’s Australian subsidiary has acquired MineWare, a mining equipment solutions provider based in Queensland.

MineWare provides systems for loading equipment such as draglines as well as rope and hydraulic shovels in mines, enhancing their payloads and visualising excavating positions.

It also has an advanced technology portfolio to improve the loading process, which boosts productivity on mining operations.

Komatsu automates mining equipment using Information and Communication Technology (ICT) and enhances worker safety and productivity through connecting jobsite data on open platforms.

With the acquisition, Komatsu can implement MineWare’s solutions into its equipment to help operators optimise their mining operations.

MineWare CEO Andrew Jessett said, “With several potential partnership opportunities in the last year, what appealed about Komatsu was the ability for MineWare to remain a highly independent entity.”

“Komatsu is the right partner to support MineWare’s next level of growth, giving us the ability to expand our global footprint quickly into new markets.”

New Report Captures Equipment Manufacturers’ Contributions to Economy

The equipment manufacturing industry supported almost 1.3 million jobs in the United States in 2016, according to a new report released Thursday by AEM.

The report, which was produced by the leading economic research firm IHS Markit, found that equipment manufacturers added $159 billion to the Gross Domestic Product (GDP) of the United States last year.

The report came as major segments of the equipment manufacturing industry met at CONEXPO-CON/AGG in Las Vegas, and as national elected leaders place a renewed emphasis on manufacturing jobs and infrastructure investment.

The research project offers the best snapshot of the equipment manufacturing industry’s reach in several years.

The report found that equipment manufacturers in the United States supported over $416 billion in sales activity in 2016, generated about $87 billion in labor income (amounting to about $78,000 in wages per equipment manufacturing industry job), and contributed over $25 billion in local, state and federal taxes.

Texas leads the country in equipment manufacturing employment and output, the report found, followed by Illinois, Wisconsin, Ohio and Iowa.

The research also examined the equipment manufacturing industry’s impact in Canada. Equipment manufacturers in Canada supported some 149,000 jobs last year, and generated some $15 billion (USD) for the Canadian economy in 2015.

“AEM is proud to represent the men and women of the equipment manufacturing industry across our country. This new report helps to put into context the many great contributions of our industry,” said AEM President Dennis Slater. “Our industry is a core part of America’s manufacturing economy, and we are eager to continue to grow, and, hopefully with a significant investment in our infrastructure, help put millions of Americans to work.”

IHS Markit additionally examined the equipment manufacturing industry’s impact over the construction, agriculture and energy (including oil and gas and mineral exploration) equipment segments. IHS Markit found that construction equipment manufacturers make up about 38 percent of the industry and directly support 163,000 jobs; farm equipment manufacturers represent 27 percent of the industry and directly employ about 114,000 people; and energy equipment manufacturers account for about 35 percent of the industry and directly support 148,000 jobs.

The research examines the direct impact of equipment manufacturers on the economy, as well as indirect effects at suppliers, service providers or other ancillary businesses related to the industry. The report also accounts for the induced effects of the industry (i.e., the additional effects on employment and income in communities).

The report adds additional detail about some of the key variables that support each industry segment, and forecasts growth for the industry into 2018 and beyond.

Click here to access the full report.

Posted: 3/15/2017 1:57:35 PM

Alcoa inks major bauxite export deal

Alcoa World Alumina and Chemicals (AWAC) has secured its first major third party contract to supply around 400,000 bone dry metric tonnes (bdmt) of bauxite from its Huntly mine in Western Australia.

This comes after the company’s first trial bauxite shipment from WA to China in mid 2016, introducing their WA product to the global market.

The agreement is part of the company’s strategy to grow its third party bauxite business. It also follows the WA state government’s approval for Alcoa to export up to 2.5 million metric tonnes per annum of bauxite for five years to third party customers.

“Bauxite exports have the potential to generate greater value from our WA mineral lease, creating additional revenue streams for Alcoa and the state of Western Australia, while maintaining supply to our three WA refineries,” Garret Dixon, president of Alcoa Bauxite said.

The WA contract is one of three bauxite agreements the company recently signed worth $US126 million, to deliver approximately 2.2 million bdmt of bauxite from its two mines in Brazil – Juruti and Mineração Rio do Norte.

The contracts increase the total value of Alcoa’s 2016 and 2017 third-party bauxite supply agreements to nearly $US600 million.

Alcoa is the world’s largest bauxite miner with 45.3 million bdmt of production in 2015.

It predicts the third-party bauxite demand will double between 2015 and 2024, with China as the biggest importer.

BHP Billiton locks in technology partnership with Hatch

BHP Billiton and technology company Hatch have entered into a collaborative development partnership, which will aim to accelerate the development and deployment of technological advances in mining and mineral processing.

According to Hatch, a collaborative approach like this is the future of technology development in the mining industry.

Damien Harding, Hatch’s performance innovation director, said the partnership’s intent was the future of technology development in the mining industry.

“Our two companies are working together to accelerate the realisation of benefits from potential innovations. BHP Billiton will have access to Hatch’s proven technology-commercialisation experience and deep mining-domain expertise in business process design, operational performance, engineering, and digital systems,” Harding said.

He added that Hatch developed a healthy ecosystem of expert practitioners and collaborating global partners to support the partnership.

“Our essential differentiator goes beyond having the depth and breadth of skills to innovate. It’s also the knowledge and expertise to integrate all the elements we need to rapidly develop and implement holistic solutions that will have a significant impact on the mining industry,” Harding said.

Rio Tinto awards iron ore contract to Decmil

Perth-based mining contractor Decmil has secured a new contract at Rio Tinto’s iron ore operations in the Pilbara region of Western Australia.

The $40 million contract will see Decmil design, construct and commission new facilities at the Nammuldi and Silvergrass mines. The project scope also includes modifications and extensions to existing facilities at the Nammuldi mine.

In an ASX announcement, Decmil said the project would start immediately and was expected to be completed in late 2017.

Rio Tinto announced in August that it would invest $338 million to complete development of the Silvergrass mine, which is adjacent to the Nammuldi mine.

After making this decision Rio Tinto awarded RCR Tomlinson a $120 million contract to provide materials handling systems at the Silvergrass mine.

The contract included the engineering, procurement and construction of a new primary crusher, nine kilometres of overland conveyors and associated power lines.