RUC Cementation wins big Australia gold mining contract

Murray & Roberts says its Australia-based RUC Cementation Mining Contractors unit has secured a Dacian Gold contract estimated at A$220m with an option for extensions for underground mine development and production.

The three-year contract is for Dacian Gold’s new Mount Morgans gold project near Laverton in Western Australia, about 750km northeast of Perth. Its value is about 10% of the existing Murray & Roberts order book.

“This award represents a major milestone in our company’s transformation from midlevel to being recognised as a top-tier mining contractor,” said Barry Upton, MD of RUC.

He said the contract was awarded after a competitive bidding process to deliver on budget, on time and safely.

The mining lease area is in the Laverton gold district. This is known to contain about 30-million ounces of gold, making it the second-largest such district in Western Australia. RUC is a wholly owned subsidiary of the Murray & Roberts group. It offers turnkey solutions for underground mining throughout Australasia.

“This is a significant award for RUC and a material award for the group’s global underground mining platform,” said Henry Laas, Murray & Roberts group CEO. Laas said that the outlook for world metals and minerals markets was improving steadily on new investment in the global mining sector.

The group has left building and infrastructure markets in SA to pursue international underground mining, oil and gas, and power and water projects.

In terms of a voluntary settlement agreement with government to rapidly transform SA’s construction industry, a consortium led by the Southern Palace Group has bought the general building and civil engineering businesses of Murray & Roberts for R314m.

Meanwhile, Germany’s ATM Holding has acquired 25.46% of Murray & Roberts’ shares on the JSE, making it the biggest shareholder.

This comes as the group reported a drop of more than 70% in interim diluted continuing headline earnings a share for the six months to December. Murray & Roberts reported an attributable loss of R60m in the period, from a R376m profit in the same period in 2015.

ATM is a subsidiary of Aton, a private German investment holding company with stakes in mining and engineering activities. Aton discussed a potential merger with the mining operations of Murray & Roberts between September 2015 and April 2016, but nothing came of the talks. By buying such a large stake, it is fuelling speculation of a possible hostile takeover bid.