Red 5 Ltd (ASX:RED) has awarded an integrated haulage and road maintenance services contract to service its King of the Hills (KOTH) gold processing facility which is nearing completion in Western Australia.
The contract with MLG Oz Limited aligns with Red 5’s Darlot mine plan and KOTH processing hub strategy and is to service the KOTH processing facility, with run of mine ore from satellite sources at Darlot and Greater Western.
This new contract falls within MLG’s Western Australian Operations and is for an initial term of two years with a further one-year extension option at the discretion of Red 5.
It is expected to increase MLG’s annual revenue with Red 5 to $20 million from approximately $10 million.
“Long-standing customer”
MLG founder and managing director Murray Leahy said: “We are very pleased to be given the opportunity to continue to support and grow with Red 5 which has been a long-standing customer of MLG.
"The KOTH project and Darlot expansion are very exciting opportunities for Red 5 and we look forward to supporting the company in developing its regional hub.”
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Ore from Darlot and Greater Western is expected to be processed through the KOTH mill from the June quarter of 2022.
Red 5’s regional strategy aligns strongly with MLG’s existing Goldfields’ network.
The new KOTH mill is a low cost conventional 4 million tonnes per annum plant in the Eastern Goldfields and is central to Red 5’s processing hub strategy to facilitate the processing of ore from multiple regional sources at KOTH.