The Perenti Global Ltd (ASX: PRN) share price is climbing today after the diversified mining company announced a contract update for the Savannah Nickel Project.
At the time of writing, Perenti shares are up 4.76% trading at 77 cents. It's worth noting that the company's share price has accelerated by more than 10% this week.
What did Perenti announce?
Investors are driving up the Perenti share price following the company's latest positive release to the ASX.
In its statement, Perenti revealed its subsidiary, Barminco has finalised a contract with nickel producer, Panoramic Resources Ltd (ASX: PAN). The deal will see Barminco provide development and production works at the Savannah Nickel Project in the Kimberley region of Western Australia.
Barminco, wholly-owned by Perenti, is one of the world's largest hard rock underground mining services companies.
The finalised contract is valued at around $280 million over a four-year period.
Under the original initial Letter of Intent in April, Barminco began mobilisation efforts and early mining works ahead of schedule. As a result, the company expects development and production works to increase over the next 6 months. It hopes to achieve the full amount of revenue possible by the third quarter of FY22.
Perenti managing director and CEO Mark Norwell welcomed the partnership, saying:
We look forward to working together with the team at Panoramic to develop what we all expect will be Australia's next long-life nickel producing mine.
Despite the challenging labour market conditions in Western Australia, we have been successful in mobilising a labour force of approximately 110 highly skilled underground employees. We expect this to increase to 170 as the project ramps-up. Securing this labour force has enabled us to commence early works ahead of schedule. We look forward to providing a safe and efficient service while delivering value and certainty for Panoramic.
Perenti share price summary
While the good news has led Perenti shares higher today, over the last 12 months, its shares are down 33%. For this year alone, the company's share price is down almost 44% following the release of its disappointing business update in May.
Perenti commands a market capitalisation of about $537 million, with over 704 million shares on its registry.
