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Highfield signs contract for the construction of the declines at Muga Potash Project

Published by , Editorial Assistant
World Fertilizer,

Highfield Resources has announced the award of the contract for the construction of the declines and underground mining infrastructure at the Muga-Vipasca Potash Project (Muga or the Project) to the joint-venture formed by EPOS-Empresa Portuguesa de Obras Subterráneas S.A. and TUNELAN-Obras Subterráneas S.A.

The contracting strategy for the Muga-Vipasca Potash Project will employ an owner-managed project delivery model that envisages the construction of the declines and the underground mining infrastructure to be undertaken by a specialist mining contractor and the civil works by a general contractor. Following a rigorous tender process, Highfield has signed a contract for the construction of the declines and underground mining infrastructure with the EPOS-TUNELAN joint venture.

EPOS and TUNELAN submitted a joint offer. The combination of these two companies will take advantage of the synergies created by EPOS’ extensive experience in multiple mining and underground construction projects in different projects in Europe and the Americas along with TUNELAN’s local knowledge of Spanish construction regulations as well as its extensive practical working experience with equipment (eg. Roadheaders), similar to that which will be used in Muga. The EPOS-TUNELAN lump-sum based contract value (€48 million) is in line with the estimated capital cost included in the feasibility study published on 7 November 2023. A final investment decision needs to be reached by Highfield and funding completed as a condition precedent to initiate any payment under this contract.

The design and engineering of the declines and underground infrastructure was developed by international engineering company Systra-Subterra, which specialises in underground projects. Systra–Subterra will provide technical support and supervision during the construction of the declines and underground infrastructure at Muga. The duration of the construction agreed with EPOS-TUNELAN covers 26 months and is consistent with the overall schedule of the Project. Highfield and EPOS-TUNELAN will work together in recruiting the construction teams, paying particular focus on hiring local personnel.

Commenting on the contract with EPOS-TUNELAN, Highfield CEO, Ignacio Salazar, said: “With progress being made on the remaining funding, we are signing the contract for the construction of the two declines and underground mining infrastructure. Our team has delivered another major milestone that is key to allow us to start the construction of the main facilities at Muga. We are working hard to finalise the Civil Works and Urbanisation contract. And with that, we are well prepared to start construction and build Muga to deliver a new and robust source of a critical fertilizer located strategically in the middle of the western European market.”

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Fertilizer project news Potash Corp news