Australian Strategic Materials (ASM) has announced its subsidiary, Australian Strategic Materials Limited (ASMH), has awarded the design work for the Dubbo Project, and it is currently in early stages of development.
The contract was awarded to Hyundai Engineering Company (HEC), a company based in South Korea, and includes the provision of engineering, procurement and construction definition work (EPCD) for the Dubbo Project.
The Dubbo Project represents a large in-ground polymetallic resource of rare earths, zirconium, niobium, hafnium, tantalum and yttrium. The Dubbo Project is wholly owned by ASM and located near the village of Toongi, 25km south of Dubbo in Central Western New South Wales, Australia.
The EPCD includes an Association for the Advancement of Cost Engineering standardised estimate, an operating cost estimate, a detailed project schedule, major project plans, and early-stage engineering documentation.
Completion of the EPCD will allow HEC to produce an open book cost estimate for the Dubbo Project.
This will form the basis of an EPC offer by HEC to deliver the Dubbo Project.
ASM Managing Director, David Woodall, said ASMH was delighted to have signed the EPCD contract with HEC for the Dubbo Project.
“We are thrilled to have HEC, one of the world’s leading EPC firms, seeking to partner with us on the Dubbo Project,” Mr Woodall said.
“With this signing, ASM moves one step closer to developing our Dubbo Project and progressing our vision for a vertically integrated strategic materials business.”
Conditions of EPCD Contract
- The Contract Price for the EPCD is AU$46.7 million and is fixed for three months
- ASMH will make payments based on the delivery of milestones
- ASMH will make an initial non-refundable payment of AU$500,000 to reimburse HEC for mobilisation expenses incurred
- Conditions precedent to the commencement of the work are all necessary approvals from both parties are received, and ASMH has issued HEC with a Notice to Proceed (NTP)
- Upon receiving the NTP, HEC will commence the work, which is anticipated to take approximately 14 months
- If after three months ASMH has not issued a NTP, the Contract Price may be varied by mutual agreement based on reasonable and demonstrated costs
- If the NTP is not provided within 12 months of signing either party can terminate with no further obligations
