Long-term contractor for the Meandu Mine appointed by Stanwell Corporation

24 July 2012

Minter Ellison has advised TEC Coal, a subsidiary of Queensland Government-owned energy company Stanwell Corporation, on the letting of the long-term rolling mining services contract at the Meandu Mine to Downer EDI. The cost reimbursable contract, which has an initial term of five and a half years, will begin in January 2013 and have a value in the range of A$600 million to A$800 million.

Downer will provide a total mine service to TEC Coal, including mine management, planning, drilling, overburden removal (including dragline and truck-and-shovel operations), coal mining, coal processing, rehabilitation, and maintenance of mobile and fixed plant. TEC Coal will provide the majority of the required plant and equipment.

The Meandu mine, located at Kingaroy in south-east Queensland, supplies coal to Stanwell’s adjacent Tarong and Tarong North power stations, and holds sufficient reserves to fuel the stations until at least 2025. Stanwell assumed ownership of the Meandu Mine in 2007.

Our Construction, Engineering & Infrastructure team on the transaction comprised senior associate David Pearce with partners Ian Briggs and Julie Whitehead and lawyer Kimie Tsukakoshi.

A unique aspect of the work was dealing with new legislation, particularly the new PPS Act, which was important due to the high value fleet of mining equipment being supplied by Stanwell and also by Downer. Our team was able to work with Stanwell and Downer to resolve a number of challenges by leveraging off the relationship-based contract framework – challenges such as the PPS legislation, the carbon tax and the transition of a large workforce from the outgoing contractor in an unsettled industrial relations environment.