The contract extends Fortescue’s partnership with Leighton following the awarding of the initial $1.5 billion five-year contract in September 2012 to deliver whole-of-mine management at the nearby Firetail deposit.

The Kings deposit contract brings the total value of work for Leighton under the Solomon Hub to $2.8 billion, the largest single contract award in the history of the company.

The contract is also a big milestone for Fortescue as it travels towards its 155 million tonne per annum Pilbara expansion goal by the end of 2013.

“We’re pleased with Leighton Contractors’ performance at Firetail and we’re delighted to award the contract at Kings,” Fortescue chief executive officer Nev Power said.

The activation of the full scope of the contract will include operating and maintaining the open cut mining fleet, mine planning, ore quality control, ore processing facilities and associated infrastructure, such as the airport and village.

Leighton Contractors managing director Craig Laslett said the contract award was an indication of the company’s strong relationship with Fortescue.

“The contract is the result of Leighton Contractors’ thirty years experience in contract mining, mine services and mine management for our clients,” he said.

Under the scope of the contract, Leighton intends to subcontract more than $100 million of work to Aboriginal businesses and to ramp up Aboriginal engagement to 20% at the project within three years.

The Solomon Hub, located about 60km north of Tom Price, will produce 60Mtpa of iron ore from the Kings and Firetail deposits and result in the creation of more than 1000 jobs.

The contract comes in the wake of Fortescue celebrating the opening of the 20Mtpa Firetail mine last month, which resulted in production capacity increasing to 115Mtpa.

In more Leighton news, the company announced the successful refinancing of a $600 million syndicated cash advance facility which was launched in late April.

While the transaction was launched at $700 million, strong support from a consortium of Australian and international investors enabled Leighton to take up oversubscriptions of $300 million.

The $1 billion in commitments will be used for general working capital and corporate purposes.

Leighton said the three-year facility was priced at a lower margin than the existing facility which was due to mature at the end of the year.

Leighton Holdings deputy CEO and chief financial officer Peter Greggs said the refinancing formed an important part of its capital management program.

“We are diversifying and extending our funding sources, strengthening our balance sheet and effectively managing our capital to ensure we can grow from our existing financial base,” he said.

Nineteen banks provided commitments to the facility, nine of which were new lenders.

Shares in Leighton were sitting at $15.12 prior to market opening, while Fortescue was at $3.05.