The market for engineering, procurement and construction (EPC) in Western Australia is probably one of the most competitive in the world. The long-established mining industry, combined with a vast concentration of individual projects and plenty of work to go round, has led to the development of a robust industry with many firms striving to get their heads above the parapet. However, as competition often does, it has bred excellence among the participants and Western Australian engineering for mineral projects is seen as a benchmark quality the world over. Primero Group managing director Cameron Henry is hoping his company becomes a household name for mineral engineering in Australia and worldwide.
Primero Group is multi-disciplinary turnkey engineering and construction company based in Perth. The company has established itself on offering a true turnkey solution for mineral, energy and infrastructure projects in Western Australia. Comprising a wide range of specialist experts, the young company is beginning to establish its presence in the market outgrowing its competitors in recent years and playing fundamental roles on WA’s resource projects.
Henry begins by outlining what makes Primero stand out in the difficult market. Primero takes on each facet of the project delivery from concept design to construction on an in-house basis. Where other contractors may sub-contract design work and lead on construction or vice versa, Primero has the capability and capacity to complete the work itself.
For Henry, with his firm taking control of as many areas as a project as possible he can guarantee a cost effective and timely outcome. Losing the margin-on-margin contracting costs as well as the interface risks of multiple contractors allows Primero to deliver a project at a better cost to the client and faster.
Taking on ‘fast track’ projects is key to Primero’s service offering. For example, on a contract with Tawana Resources, Primero is taking the project from the first drill hole in the ground in January 2017 to beginning production just 13 months later in February 2018. That includes completing the test work, the metallurgical test work, feasibility studies, through to detailed design and subsequently construction and commissioning. Henry says that kind of timeframe is ‘second to none in the industry’.
With Western Australia currently a world-leading region in terms of hard rock lithium production and development, an industry that is likely to experience huge price increases with the boom in electric vehicles, Henry identified the sector as a fruitful entry point to the market and now the order books are thick with lithium projects.
Primero is working on a number of battery metal projects in WA including big contracts for Tawana, Galaxy Resources and on a rare earth project for Northern Minerals. In addition, the company has delivered a 4mtpa processing plant for PT Bumi Suksesindo in Indonesia and is in talks to expand that to 6mtpa.
On the energy and infrastructure sides Primero has had a hand in WA’s major LNG projects, Gorgon and Wheatstone, and that sector currently makes up between 15-18% of company revenue. While the firm has worked with a number of the major mining houses for non-process infrastructure projects, contributing a further 20% of revenue.
“FY18 will be our largest year to date. We probably experienced about 30% year-on-year growth in the last three years so it has been a steady but sustainable period,” explains Henry. “The lithium and battery metals space has been a key target for us. We saw an opening there and we pursued it which has been a good growth strategy.”
While the whole mining industry took a hit in the last half a decade since the commodity price crash, Henry says that a lot of business is pivoting away from the major players in the industry to new boys which are specialising in metals or disciplines.
“We have probably outgrown our competitors because we are at the right end of the cycle and the right size. A lot of the bigger companies have had to reinvent themselves over the last four years. Clients are moving away from big companies and coming to the niche or boutique firm because the size of the projects are smaller.”
Henry adds that the return of available capital for new projects has injected a boost in the energy metal sector, “It’s getting a lot of airtime and although capital has been hard to come by, lithium and spodumene are building track records with the success stories out there and people are starting to open their wallets again.”
With the industry beginning another cycle and Primero already demonstrating a track record of growth, Henry is formulating plans to expand the business’s global footprint. Now that the company name is what he calls ‘bankable’ in the sector, thanks to the quality and success of delivered contracts, Primero is sought after in terms of new clients. That name recognition has led to new work sprouting across the globe. Particularly in North and South America, where this is major lithium production, but indeed in Europe, Africa and Asia.
“In three to five years with our footprint and growth strategy, I think we will have a fairly substantial presence in North America, most likely Canada,” notes Henry. “If we keep achieving the growth that we have over the last three years, which I think is achievable for another year or two we will reach a capacity that we are comfortable with and then it will be about the making the step up to the next growth hurdle.”
Cameron suggests that could come in the form of an IPO for Primero Group – watch this space.