Mining services company Macmahon has won a three-year contract extension worth $352 million at the Boston Shaker underground gold mine in the north-eastern Goldfields.
Boston Shaker is part of the Tropicana operation 330km north-east of Kalgoorlie-Boulder, operated as a 70:30 joint venture by mining giant AngloGold Ashanti and Regis Resources.
Macmahon has been providing underground mining services at Boston Shaker since 2019, and told the ASX on Thursday it would continue its work in areas including mine development, production drilling, cable bolting and ore stoping.
The company said it would largely use its existing fleet for the duration of the alliance-style contract, which expires on May 1, 2027.
Macmahon managing director and chief executive Michael Finnegan said the contract extension was a critical step towards growing the company’s underground portfolio by 50 per cent during the next two to three years.
“With capital already deployed in the project and no new growth capital required, we expect the extension to enhance our (return on average capital employed) performance — where we recently increased our target from 15 per cent to 20 per cent,” he said.
Tropicana was fourth on the list of top-producing gold mines in Australia during the 2022-23 financial year, producing 437,178 ounces of gold, according to Melbourne-based gold industry analysts Surbiton Associates.
Regis Resources has issued production guidance of 415,000oz-455,000oz at an all-in sustaining cost of $1995/oz-2315/oz for the current financial year.
Production was disrupted in March when 310mm of rain fell over three days.