Contract Partnering - A Review of its Use in the Development of the Cannington Underground Mine

BHP World Minerals (BHP) commenced development of the Cannington exploration decline in 1993 using Peabody Resources LimitedÆs Mining Services Division (PRL) as the contractor. Approval was given in 1996 to complete the mine development and bring the mine into production in 1997. The total mine development at Cannington by PRL has included 14 km of headings, 1040 m of shaft sinking for ventilation and ore hoisting and 990 m of raise boring for ore passes and vent rises. Hard money schedule of rates contracts were used for mine development from 1993 until early-1997. This took the mine development down to 570 m below the surface and developed six levels. Because of significant risks, the final phase of the mine development was completed in 1997 under a partnering agreement. This paper examines the factors considered in making the change to partnering, the issues involved in negotiating the partnering agreement to complete the Cannington mine development and the outcomes of the agreement.