Listed contracting company Decmil says its revenue forecasts for the current financial year will take a further hit after yet more delays at two wind projects that have yet to start construction in Victoria and NSW.
It is the second time in two months that Decmil has announced that ongoing delays at the 57MW Crookwell project in NSW and the 218MW Ryan Corner project near Port Fairy in Victoria – both owned by the Naturgy GPG group – would have an impact on its short-term revenue outlook.
In April, it said the delays to the contracts – totalling $92 million – had forced it to downgrade its revenue forecasts for the current financial year by 10 per cent, and this week it downgraded its revenue forecasts by another six per cent.
Decmil says the latest delays are the result of “further delays due to the client delays in gaining project permitting and approvals.” It did not provide further details.
Naturgy GPG – which also owns and operates the completed Berrybank and Hawkesdale wind farms in Victoria – says in its most recent newsletter, published in April, that construction at Ryan Corner was due to start in May.
But it also indicated that a fresh “partial” application for its connection agreement with AEMO had still to be finalised.
Decmil won its $71 million contract at Ryan Corner in 2020, after the wind farm landed a 15 year contract in a renewables auction conducted by Snowy Hydro, and it was originally expected to start construction early last year and be in full production early this year.
It won the $21 million “balance of plant” contract for the $120 million Crookwell 3 wind farm near Goulburn in NSW a year later – mostly building access roads – and that project, which has a long term contract with Telstra, – was also due to start construction earlier this year and be complete in 2023.
Decmil dropped out of full EPC contracting in 2020 following disputes and damages claims arising from delayed projects such as the 200MW Sunraysia solar farm in NSW. That dispute is still ongoing. Many other contracting firms made similar decisions from the EPC market.
