Civmec bags multiple contracts worth A$175 million

DUAL-LISTED construction and engineering group Civmec Limited on Monday announced that it has bagged multiple projects with a combined contract value totalling approximately A$175 million (S$171.3 million).

The group said the revenue from these contracts will be realised across its metals and minerals, and oil and gas segments of its company. The revenue will also "contribute to a solid base load of activity for the company's manufacturing facilities", it added.

Civmec disclosed specific details about three particular contracts in a bourse filing. The first entails the fabrication, modularisation and commissioning of a ship loader for BHP Mitsubishi Alliance at Hay Point Coal Terminal that is still subject of final board approval by both BHP and Mitsubishi.

The contract, which includes the supply and assembly of a complete ship loader up to the no-load commissioning stage, will see work commence immediately with completion slated for the second half of 2022. The award of this scope of work will also provide an estimated peak of 150 jobs in Perth, said Civmec.

The second is a term contract for five years, plus two one-year extension options, with Australian natural gas producer Woodside Energy Limited to support its existing onshore and offshore production facilities and capital projects in Australia.

The third contract will see Civmec supply 4,700 tonnes of modules such as conveyor, trusses and trestles for the Iron Bridge Magnetite project - a joint venture between iron ore company Fortescue Metals Group's subsidiary FMG Iron Bridge and Formosa Steel IB.

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Civmec said that work for this contract will begin in October, and the company is expecting the bulk of the work to be completed in FY2021. The group added that most of the work will take place at its Henderson facility in western Australia.

In addition to the above contracts, Civmec said it has recently secured new and increased orders across its minerals and metal, and oil and gas sectors, including the replenishment of orders for the fabrication of tray bodies for dump trucks from its Newcastle manufacturing facility.

Civmec's CEO Patrick Tallon, said: "We are extremely pleased to be given this opportunity to further support BHP in the delivery of a ship loader. This contract follows on from other smart modules and machines delivered by Civmec for BHP projects as part of our partnership delivering high quality, complex machines."

He added: "We are also privileged to have secured a long-term contract with Woodside, having delivered several projects to them in the past. This contract will provide us with a base load of work and allow us to work with Woodside as a partner to optimise efficiencies and savings in the delivery of our services to them over the longer term."

Shares in Civmec closed flat at 37 Singapore cents on Monday before the announcement.