Macmahon in talks with Newcrest, pre-empts provision $25-35m

Company News

by Jessica Amir

Macmahon (ASX:MAH) and gold major, Newcrest Mining (ASX:NCM) have entered into good faith negotiations regarding Macmahon’s life of mine mining contract at the Telfer project.

If the Telfer discussions remain ongoing at Macmahon’s next reporting date, it expects to see a provision of between $25 to $35 million.

Telfer is a mine site in the Pilbara region of Western Australia, within the Great Sandy Desert. And Macmahon first started the Telfer Contract in February 2016.

Macmahon says pending the negotiation outcome, it is reiterating its EBIT guidance for FY19 of $70 to 80 million (excluding the one off provision mentioned earlier).

The facilitated negotiations will end by no later than 5 August 2019.

Macmahon is confident of the outcome but says it’s prepared to commence a contractual dispute resolution process if the good faith negotiations are unsuccessful.

Macmahon (ASX:MAH) shares are trading 2.94 per cent higher at $0.18
 

Jessica Amir

Finance News Network
Jessica joined FNN in January 2017 after having worked in financial advising for seven years and in TV journalism for seven years, specialising in finance, equities and analysis. She has interviewed former Prime Ministers of Australia, Tony Abbott, Julia Gillard and Kevin Rudd and ex Treasurer Jo Hockey. Jessica has worked as a journalist with Sky News Business, ABC 1, ABC's The Business, ABC24 and has also been a regional Channel 7 and 9 TV reporter with Prime7 and Win News.