20 November 2009
The Company Announcements Platform
Australian Securities Exchange
Level 4
20 Bridge Street
SYDNEY NSW 2000 By e-lodgement
Dear Sir / Madam,
UPDATE ON ACTIVITES
The directors of EDMS are pleased to provide an update on activities following the completion of Tranche 1 of the recent capital raising.
1. Current Business Activities
Commentary
Generally, we continue to experience strong demand for surface rigs in coal and CSM, and are ramping up our capabilities in these areas. The recent capital raising and utilisation of available debt facilities has made possible the purchase of additional coal and CSM rigs at just the right time.
The underground diamond rig utilisation is improving however, utilisation of DTH rigs remains poor with potential contracts pushed back into the new calendar year.
We experienced some logistical and maintenance issues in November that, combined with lower DTH utilisation, slowed our revenue ramp up. Moving forward the revenue outlook is strong with additional coal and CSM rig utilisations more than offsetting the DTH division.
We are also very pleased to have made a number of quality senior management appointments, significantly improving the strength and experience of our team as outlined below.
Additional Rig Mobilisations and Current Utilisation
During November, GOS drilling has mobilised an additional underground rig, taking the number in the field to 5. We have also mobilised one large rotary rig with a further one due on site in the Bowen basin on a new Peabody site by Monday 30 November 2009. In the lead up to Christmas, we envisage mobilising one additional Rotary rig on site in the Hunter Valley.
The first CSM coring rig for AGD is due to commence work in the week commencing 30 November 2009 following the delivery of the key ancillary equipment.
Other business units
EDSM has continued to expand its labour hire division in the Cobar region to 25 people with further demand building for the new year.
We are also pleased to advise that the batch plant at CSA is re-commencing work next week.
In addition, our equipment rental division is also seeing increased demand in line with increased activity across all mines in the Cobar region that bodes well for the remaining EDMS operations.
2. Expansion of Drill Fleet
G.O.S. Drilling (GOS) is please to advise that it has taken delivery of a new Hydco 1200 multipurpose rig that is being commissioned on the Denham Pit project for Peabody in the Bowen Basin.
GOS has also placed deposits on three new Atlas Copco diamond drill rigs which are scheduled for shipping from the US prior to Christmas. These rigs are planned to be utilised on projects in the Hunter Valley and Gunnedah basin.
GOS will have a fleet of 23 rigs post these acquisitions.
Australian Gas Drilling (AGD) has acquired an extensive drill package from the US which includes an Atlas Copco RD20 III rig, which is a large diameter rig designed for CSM work. This package comes complete with all ancillary equipment.
AGD has also placed an order for a new CSM certified KWL 1600 multipurpose rig for delivery in Jan 2010 and ancillary gear including BOP equipment.
The AGD fleet will comprise three modern drill rigs suitable for a diverse range of applications.
3. New Employment Appointments
To deal with the continued growth in our business, EDMS is pleased to advise that it has recently made senior appointments as follow:
Australian Gas Drilling General Manager
Mr Dirk de Hamer has been appointed as the General Manager of AGD commencing 30 November 2009. Dirk joins AGD from Lucas Drilling where has been supervising their NSW Coal Seam Gas fleet for the last twelve months. Prior to joining Lucas, Dirk was the surface manager for G.O.S. Drilling for a number of years.
QLD Manager
Mr Steve Swilka has been appointed the new QLD Manager for EDMS and G.O.S. Drilling. Steve joins us from MaConnell Dowell where he was the lead project manager on a number of large pipeline and tunnelling projects. Prior to this, Steve worked with CSM drilling company Des Caling as a trainer and in an OH&S role, as a mines inspector in QLD, and was an underground foreman in a number of mines in Australia. Steve comes to EDMS with an extensive knowledge and awareness of OH&S requirements in Australia.
QLD OHS Officer
Mr Ian Corkhill has been appointed to fill this key role in Queensland based out of McKay. Ian joins EDMS from Xstrata Coal and we welcome Ian's extensive experience in the QLD coal sector.
4. Change to Managing Director's Terms of Employment
The Company is also pleased to advise that it has secured the employment of Ashley Pattison long term through a re-negotiation of his employment agreement effective 1 October 2009.
Material changes to the employment agreement previously announced to the ASX include:
interests, confidentiality and an additional termination clause for medical reasons.
- Salary package increased to $270,320 per annum inclusive of superannuation;
- Should the company wish to terminate the employee, the company is required to provide 6 months notice or payment in lieu of notice unless termination is for gross misconduct;
- Should the employee wish to cease his employment, the employee is required to provide 2 months notice;
- Enhanced clauses in favour of Company covering matters such as protection of company
For further details on this announcement, please contact Ashley Pattison, Managing Director
on (02) 4015 3100.
About EDMS
EDMS is a diversified mining service and drilling contractor headquartered in Rutherford, NSW. The group comprises four subsidiaries who service the metalliferous and energy sectors primarily in NSW and Queensland. EDMS operates depots in Rutherford, Cobar, Gunnedah, Mackay and Mt Isa to service its expanding client base that includes China Shenhua, Peabody, Xstrata, Glencore, Apollo Energy and CBH Resources.
Website: www.everydaymineservices.com.au