Suppliers News (August 20, 2007)

SNC to work with local engineers at Anglo’s Barro Alto

SNC-Lavalin Group (SNC-T, SNCAF-O) has teamed with local engineering firm Minerconsult Engenharia to win a US$100-million contract to build a ferro-nickel plant near Barro Alto, in Goias state, Brazil.

Anglo American’s (AAUKD-Q, AAL-L) Brazilian subsidiary is building a nickel mine, 170 km northwest of Brazil’s capital, Brasilia.

The contract with Anglo American includes expansion work on the mine’s existing operations. Altogether, the major is spending more than US$1 billion on the metallurgical facility and further expansion.

“(SNC) has the opportunity to use our international expertise in nickel mining and processing and combining it with our partner’s local knowledge, and presence on this key project,” says Pierre Duhaime, executive vice-president of the SNC-Lavalin Group’s global mining and metallurgy operations.

Engineering and preparation work began at the Barro Alto plant in January. Construction will start in November, with production slated for early in 2010. Anglo says design capacity should be reached by 2011, with the plant producing 36,000 tonnes of ferro-nickel annually.

Montreal-based SNC-Lavalin has offices across Canada and in 34 other countries.

Minerconsult Engenharia is a Brazilian engineering firm that provides a range of engineering, technical and construction management services to the mining industry.

Finning to supply Esperanza project with heavy equipment

Finning International (FTT-T, FINGF-O) says its South American division has sold more than $140 million in mining equipment to Antofagasta Minerals (ANFGY-O) for use at the company’s Esperanza open-pit copper-gold mine in Chile.

Both companies continue to work on a 6-year product support agreement, where Finning makes most of its money.

“The opening of the Esperanza project is very positive for Chile’s growing mining sector,” says Juan Carlos Villegas, president of Finning South America. “As with all of our customers, the equipment will be backed by the best support for maintenance and repairs in the industry.”

The equipment package includes 20 new and 11 used 360-ton Caterpillar 797 mining trucks; two O&K RH-340 hydraulic shovels; and 26 pieces of support machinery, mainly large bulldozers and motor graders.

The production fleet will total thirty-one 797 trucks by the third year of operations. The equipment should start arriving in January 2008, with more than 60% of the fleet arriving that year. The balance will reach Esperanza in 2009 and 2010.

The Esperanza project, in northern Chile, is expected to operate for 15 years. Construction will start in the first quarter of 2008 with production expected in late 2010.

Finning is the world’s largest Caterpillar (CAT-N) equipment dealer.

Finning also owns Hewden, the largest equipment rental business in the U.K.

Fluor, SKM get BHP iron expansion contract

Irving, Tex.-based Fluor (FLR-N) has a deal with mining house BHP Billiton (BHP-N, BLT-L) to design, build and manage a US$1.8-billion iron ore expansion project in Western Australia.

Fluor will get half of the $1.8 billion; privately held Aussie engineering firm Sinclair Knight Merz (SKM) will get the rest. The companies have already formed a joint venture based in Perth, Australia.

“Fluor’s long-term presence in Australia combined with our substantial mining experience allows BHP Billiton to increase overall mine efficiency in addition to expanding output,” says Dwayne Wilson, Fluor’s group president for industrial and infrastructure.

The expansion will increase the capacity of the mine to 155 million tonnes per year from 129 million tonnes. Fluor and SKM will also modify rail and port facilities with completion expected in early 2010.

Fluor provides engineering, procurement, construction, and project management services, and in 2006, posted revenue of US$14.1 billion.