Perenti subsidiary and hard-rock underground miner Barminco has received a letter of intent (LoI) from Barrick Gold to provide underground contract mining services for Barrick’s Hemlo gold mine in Canada.

Hemlo gold mine is located in the Marathon mining district of north-western Ontario, Canada.

The contract, which is proposed to be valid for three years, is valued at A$200m ($131.7m).

As part of the contract, Barminco will provide advanced technology and productivity to the gold mine to support Barrick’s goal to modernise the mine to establish it as a tier two asset within the company’s portfolio.

Perenti group managing director Mark Norwell said: “This is Barminco and Perenti’s first significant contract in North America and builds on our regional growth capabilities, after expanding into Botswana last year with an $800m contract. We look forward to supporting Barrick to deliver outstanding results at Hemlo.”

The work scope of Barminco’s contract includes undertaking of mine development, production and haulage, as well as utilising mining equipment provided by Barrick.

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By GlobalData

Barminco will employ more than 300 staff at the operation, with work expected to start in April this year.

Barminco CEO Paul Muller said: “We are thrilled to be in a position to support Barrick to improve the performance of the Hemlo mine.

“We intend to work very closely with Barrick and all key stakeholders, including the incumbent workforce at Hemlo, the Pic River and Pic Mobert First Nations people and the Marathon community more generally to deliver a sustainable improvement in performance, thereby assuring the future of Hemlo.”

The Hemlo gold mine has produced over 21 million ounces (Moz) of gold over 30 years.

In January this year, development and exploration firm Panoramic Resources selected Barminco as its preferred underground contractor for the Savannah project in Western Australia.