Owned by Riversdale (65%) and Tata Steel (35%), Benga is in the initial stages of development. This week’s early procurement contract with Sedgman relates to the $US270 million first stage of the project.

Stage 1 entails processing 5.3 million run-of-mine tonnes per year to produce 1.7Mtpa of hard coking coal and 300,000tpa of export thermal coal.

The CHPP is being designed for an initial throughput of 800 tonnes per hour with provision for staged expansion to 3000tph.

Sedgman has targeted the southern African market this year, with the Benga deal following the recently announced $75 million design and supply contract for Xstrata’s ATCOM project near Johannesburg.

“We have been working closely with Riversdale since our appointment in September 2008 to undertake the design and implementation work for the CHPP and have now moved to the next stage of procurement,” Sedgman managing director Mark Read said.

“The remaining design, supply and construction contracts for Benga are now being negotiated and are expected to be signed in the new year.”

Sedgman was trading A2.5c down to $1.52 this morning.