Strong demand from Australian miners and explorers for drilling services is being reflected in the capital spend of leading industry-activity proxy, DDH1, which has added more rigs to a burgeoning drill fleet.
ASX-listed DDH1 (DDH) said the three “new-generation surface rigs”, all with advanced automation features, would not arrive until mid-2022. They are set to take the company’s rig count to 110, adding to the 10 units brought in during FY21 to complete about 2.2 million metres of drilling for 94 customers last financial year, and eight rigs already ordered for delivery in FY22.
Nearly half of DDH1’s A$294.6 million of FY21 revenue came from the gold sector, with iron ore (19%) and copper-gold (15%) accounting for more of the balance. The company says it has zero exposure to coal while battery minerals such as nickel and lithium are growing in importance.
DDH1 said its new investment underlined its confidence in a continued strong market outlook in Australia where it remains totally focused.
The company’s revenue was up 17.9% in FY21, its first year as a public listed entity, while ebitda climbed 15.6% year-on-year to A$74.6m.