Downer EDI Limited (Downer) today announced it had received a Letter of Intent from Cobar Management Pty Limited advising of its intention to enter into a contract with Downer for mining services at the CSA Mine, which is an underground copper mine located in Cobar, Central Western NSW. The Letter of Intent is subject to the parties executing a binding agreement.

Cobar Management Pty Limited is a wholly owned subsidiary of Glencore plc, a global diversified natural resource company.

The two year contract is valued at approximately $70 million and has an additional one year option. It is scheduled to commence in July 2015.

The scope of works includes mechanised decline and lateral development mining and haulage, with the provision of ground support services including shotcrete and cable bolting.

The Chief Executive Officer of Downer, Grant Fenn, said the contract award was an endorsement of Downer's underground mining capabilities.

"Downer has a highly skilled and experienced hard rock underground mining team and we continue to build this part of the mining business," Mr Fenn said.

"We look forward to working with Cobar Management on this important project."

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