Mastermyne has secured a mining services contract worth up to $508.7m (A$660m) for the Gregory Crinum coal mine in central Queensland, Australia.

The seven-year contract has been awarded by Japanese company Sojitz Blue.

Mastermyne will be responsible for the re-establishment of the underground infrastructure including conveyor systems, ventilation, associated mine services, remediation works and surface infrastructure.

The firm will also provide underground mining equipment, including three bord & pillar miners, multi bolters and shuttle cars as well as a range of ancillary production equipment to support the operation.

The underground mine is expected to have a production capacity of around 11 million tonnes run of mine during its operational life.

The re-establishment work is expected to take six months. This will be followed by six and a half years in the mining production phase.

Production at the mine is planned to commence in late 2021 and is expected to employ 180 people.

The contract award follows the completion of feasibility study by Mastermyne in 2020. The study focused on the development of a high productivity bord and pillar mining operation.

Moreover, Mastermyne was selected as the mine operator to undertake the re-entry process at the underground mine.

Located 60km north-east of Emerald in the Bowen Basin, the Gregory Crinum mine had a capacity of six million tons of hard coking coal per annum when production was ceased in January 2016. Later, the mine was placed into care and maintenance.

The site comprises the Crinum underground mine and Gregory open cut mine. It also consists of undeveloped coal resources and on-site infrastructure, including a coal handling and preparation plant, maintenance workshops and administration facilities.

Mastermyne CEO Tony Caruso said: “Through the detailed feasibility work and contract negotiations the team has put together a balanced contract structure that minimises downside risk whilst at the same time rewards the business (through stronger margins) for better production performance.”