Moly Mines through its subsidiary, Moly Metals Australia (MMA), and the Chinese engineering company CACS Corporation have entered into a fixed price engineering, procurement and construction (EPC) contract for the Spinifex Ridge Molybdenum/Copper Project.
Australian engineering, consulting and contracting company GR Engineering Services has agreed to act as a sub-contractor to CACS and will be responsible for design, construction and construction management activities under the EPC. CACS will be responsible for procurement activities.
Moly Mines’ CEO Derek Fisher says that “the partnering of a respected and highly experienced Australian engineering company with the leading Chinese engineering contractor in this fixed price arrangement is a great positive for the company and the project. It is a structure that we strongly believe will complete the project on time and on budget.”
CACS is a subsidiary of Sinomach, China’s largest machinery manufacturing and engineering services company and was established in 1981. CACS has undertaken procurement, engineering, design and construction works in the fields of electrical power, petrochemical, metallurgy, textile, construction materials, ports and public infrastructure.
The EPC contract will not begin until Moly Mines has received unconditional financing for the project and the Board of MMA makes a final decision to proceed with the project. The EPC lump sum contract price for the project, which includes Australian dollar and US dollar denominated packages, is estimated at US$608 million.
Moly Mines and Hanlong Mining Investment continue to finalize the structure and documentation of the US$500 million in senior secured finance and working capital facilities that have been approved by China Development Bank for the project. The completion of the EPC contract with CACS is one of the key project documents that are required as a condition precedent to completion and first utilization of this financing facility.