Aurizon Holdings Limited (ASX:AZJ) Awarded BHP Copper Logistics Contracts
Contract Details
Aurizon has been awarded contracts to provide an integrated rail, road and port logistics solution for BHP’s Copper South Australia operations, for a term of up to 15 years. The contracts are scheduled to begin in October 2025, with Aurizon’s aggregate logistics task approximately 1.3 million tonnes per annum and total anticipated revenue over the initial 10 years of ~AU$1.5 billion.
Operational Plan
The logistics solution involves transporting copper concentrate and cathode from BHP’s Olympic Dam, Carrapateena, and Prominent Hill mines via rail between Pimba and Port Adelaide. Aurizon will handle services across the supply chain, including rail haulage, road transport, terminal management, port management, and stevedoring. Aurizon will subcontract road transport to Symons Clark Logistics (SCL). Aurizon will leverage its South Australian assets, including the newly acquired Port Adelaide (Berth 29) and the Gillman containerised freight terminal, and construct a new rail freight terminal at Pimba.
Financial Performance
An aggregate capital requirement of ~AU$100 million is expected to deliver the logistics solution, with the largest investment being the Pimba terminal at ~AU$40 million. This investment maximises the scale and efficiency of existing capital in South Australia.
Sustainability Impact
The shift to an integrated rail, road and port solution is expected to replace an estimated 13 million kilometres of truck movements annually on South Australian roads, improving road safety, reducing congestion, and lowering emissions.
Executive Comments
Aurizon’s Managing Director & CEO, Andrew Harding, stated, “Aurizon is delighted to secure these large-scale long-term contracts with BHP’s Copper SA, supporting the success and expansion of one of the nation’s most significant resources. These contracts represent a major milestone in the delivery of Aurizon’s Bulk strategy. It validates the company’s decision to invest ahead of earnings through targeted acquisitions and infrastructure development, particularly in South Australia and the Northern Territory. This investment has built the capability needed to be able to provide a complex logistics solution of this scale and demonstrates Aurizon’s readiness and competitiveness in the national bulk market. It also demonstrates the growth opportunities available for our Aurizon Bulk business moving into new geographies and expanding markets for future-facing commodities such as copper, where the global demand is projected to increase significantly.”
Motley Fool contributor Lauren Surplice has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended BHP Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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