CIMIC’s Thiess secures $420 million mining contract at Encuentro copper oxide project

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Cimic Group

Mining and mineral processing unit of CIMIC group, Thiess wins a $420 million further contract by Chile-based Antofagasta Minerals to continue mining operations at the Encuentro open pit.

It is a four-year contract extension to carry on with drilling, equipment maintenance, load-haul, and other mining services provided by Thiess at Encuentro. The development activities will also include the cable bolting, shotcreting, and full fleet maintenance services.

Antofagasta Minerals’ owned Encuentro is an exploration and mining project, located at Northern Chile. The open pit mining operations at Encuentro focus on copper oxide ore. Thiess has been working with copper mining group Antofagasta Minerals (AMSA) since last three years. This extension of contract reinforces the delivery of services catered by the Brisbane-based mining services provider.

With this $420 million contract award, Thiess outlines the second win in a row this month. Last week, the company has secured $190 million contract extension at Leinster Underground Mine with BHP Nickel West. It is for a minimum of 24 months contract to provide comprehensive underground mining services associated with ore production and development at Leinster Underground Mine in Western Australia.

Since inception in 2015, for the first time Thiess has moved over 70 million cubic metres in South America, said Douglas Thompson, Thiess Managing Director and CIMIC Group Executive Mining and Mineral Processing.

Further, the company plans for future improvement by injecting more funds in infrastructure maintenance along with enhancing the management system and mining practices. 

It is known that the contract mining company, Thiess is a part of international contract miner, CIMIC group. It provides a range of in-house surface and underground mining services while having its operations in Australia, New Zealand, Canada, Mongolia, Botswana, Chile, Indonesia and India. The company’s Centinela operations has been recently awarded with ‘National Geology and Mining Service Award’ for safety performance by the government of Chile. The group has reported mining and mineral processing revenue from Thiess and Sedgman to $3,164.4 million in the 12 months ended 31 December 2017.

Though the company has secured another term of contract with its existing clients, the stock was seen in red. The CIMIC Group’s stock was trading at $50.590 after slipping by 0.648% on 17 September 2018 (5:32 PM AEST). Over the past one year, the stock has seen a performance change of 17.52% while trading at PE of 22.2260 x with market capitalization of $16.51 billion. CIMIC has a dividend yield of 2.8%, and has lately secured many contracts including the ones worth US$310M in South Africa, about $165M in Maintenance Services, and contracts worth US$118M under Mineral Processing.

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