The contract reinforces Downer’s ties with Xstrata mines in the region, and a team of the company’s engineers have been carrying out design work on the CHPP from the concept stage for more than two years.

“Downer has a strong relationship with Xstrata Coal and this two year alliance contract follows the successful delivery of Xstrata’s Mangoola CHPP in May this year,” Downer chief executive officer Grant Fenn said.

“The Ravensworth North coal project is another good example of our successful alliance approach with one of the world’s largest diversified mining groups.

“We have been providing services to Xstrata at its Mount Owen, Liddell and Mangoola mines in the Hunter for the past four years and we look forward to further growing our relationship with them.”

The new CHPP project for Downer is expected to secure more than 400 jobs.

The new pit at the existing Ravensworth operations is targeting 8 million tonnes per annum of export thermal and semi-soft coking coal at full production for a mine life of 26 years.

Back when Xstrata’s board approved the project in December, first coal was slated for July, 2012.