The Monadelphous Group Limited (ASX: MND) share price is trading lower on Monday despite the release of a positive announcement this morning.
At the time of writing the engineering company’s shares are down 0.5% to $17.12.
What did Monadelphous announce?
This morning Monadelphous made an announcement relating to its 60% owned incorporated joint venture, Mondium Pty Ltd.
Mondium is an engineering, procurement and construction (EPC) service provider targeting and delivering EPC projects in the minerals processing sector.
According to today’s release, Mondium has been awarded a major contract, valued at approximately $400 million, with mining giant Rio Tinto Limited (ASX: RIO).
The contract is for the design and construction of the Western Turner Syncline Phase 2 (WTS2) mine, located in the Pilbara region of Western Australia.
Mondium will carry out all engineering and design, procurement and site construction works associated with the WTS2 development. This includes the process plant, overland conveyor and non-process infrastructure.
The joint venture’s managing director, Andrew Carnie, believes this contract award is a major strategic milestone in its growth strategy.
He said: “Mondium has been working hard to execute projects successfully and prove our capability. We are thrilled to be making great strides in our growth strategy and to have secured this significant contract with Rio Tinto.”
This sentiment was echoed by Monadelphous’ managing director, Rob Velletri. He said that “being chosen to partner with Rio Tinto to deliver these important mine expansion works was a great achievement for Mondium.”
“The award illustrates the strong progress Mondium has made in cementing itself as a preferred and trusted provider of EPC services. I would like to congratulate all involved in this historic win,” he added.
The shares of fellow joint venture partner Lycopodium Limited (ASX: LYL) have pushed higher on the news. At the time of writing the Lycopodium share price is up a sizeable 4.5% to $6.06.
Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.