Duratec Limited Announces Significant Contract Wins in Energy and Defence Sectors
DUR (DUR) Share Update September 2024 Monday 9th
Duratec Secures Major Contracts in Energy and Defence Sectors
Duratec Limited (ASX: DUR) has announced two major contract awards totaling $76.5 million, marking significant strides in the Energy and Defence sectors.
Instant Summary:
- Duratec secures $21.8 million contract for King Bay Supply Base Wharf Refurbishment.
- DDR, a Duratec associate, wins $54.7 million contract for Project Phoenix with the Department of Defence.
- Contracts aim to enhance infrastructure and operational efficiency.
- Work on both projects to commence in late 2024.
Contract Details
Duratec Limited, a leading Australian contractor, has secured two significant contracts in the Energy and Defence sectors. The first contract, valued at $21.8 million, is for the King Bay Supply Base (KBSB) Wharf Refurbishment. This project, located within the Port of Dampier in Western Australia, is Duratec's first direct contract with Woodside Energy Ltd. The project aims to extend the service life, maintain operational efficiency, and enhance the safety and resilience of the existing wharf facility. Pre-work is anticipated to start in November 2024, with on-site work commencing in February 2025 and expected completion by the end of 2025.
The second contract, awarded to DDR Australia (DDR), a 49% owned associate business of Duratec, is part of the Project Phoenix portfolio for the Department of Defence. Valued at $54.7 million, this is the largest contract awarded to DDR to date. The project includes the refurbishment of existing buildings, upgrading engineering services at transmit and receive sites, constructing a new receive site, installing new fibre optic link cables, and decommissioning high-frequency communications infrastructure. Early civil works are targeted to commence in October 2024, with the combined duration of the current works anticipated to be 30 months. This project will be delivered with regional delivery partners to ensure local businesses benefit from the contracted works.
Company Statements
Duratec's Managing Director, Chris Oates, expressed his excitement about the new contracts, stating, 'We are delighted to be working directly with Woodside as we execute Duratec's wider business strategy to pursue diversification through investment in the Energy sector. The DDR award demonstrates that the Company continues to be a trusted Defence partner, and we look forward to supporting DDR in delivering this significant project. These are exciting steps forward for both Duratec and DDR.'
These contract awards are likely to have a positive impact on Duratec's stock price. Securing a direct contract with a major player like Woodside Energy Ltd enhances Duratec's credibility and market position in the Energy sector. The significant Defence contract further solidifies DDR's standing as a trusted partner in critical infrastructure projects. Investors can expect increased revenue streams and potential growth in market share as a result of these contracts.
Investor Reaction:
Analysts are likely to react positively to this announcement, given the substantial value of the contracts and the strategic importance of the sectors involved. The direct contract with Woodside Energy Ltd is particularly noteworthy as it opens up further opportunities in the Energy sector. The Defence contract reinforces DDR's reputation and could lead to additional government projects in the future.
Conclusion:
Investors should keep an eye on the progress of these projects and the potential for further contract wins in the Energy and Defence sectors. Duratec's strategic diversification and strong project pipeline position the company well for future growth. Staying informed on these developments will be crucial for making informed investment decisions.