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Macmahon Holdings has finalised a $330m contract with Fortescue Metals Group and begun construction on iron ore miner’s Solomon Rail project in the Pilbara region of Western Australia.

Under the contract, Macmahon will build an 81km of railway spur from its Pilbara rail line to its new Solomon iron ore mines.

Macmahon CEO Nick Bowen said the contract was a significant project for the WA resources sector and another example of Macmahon’s capabilities in the delivery of major infrastructure.

"There is no mistaking that the Solomon Rail Spur is a significant opportunity for Macmahon and is one of the biggest single construction contracts for the company," he said.

The rail formation works include over six million cubic metres of earthworks that includes sidings and associated drainage and the construction of four major bridges including two over the Fortescue River

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In addition, the project also includes the establishment of level crossings over the Great Northern Highway and other roads in the region.

Macmahon has undertaken preliminary works on the construction of the 81km rail formation after being selected as the preferred contractor in August 2011.

The project is scheduled for completion in late 2012.

In November this year, Fortescue Metals Group awarded a $60m contract to Brierty for the construction of approximately 25km of rail formation for the Solomon Rail Spur.

The projects are part of Fortescue Metals’ $8.4bn expansion in the Pilbara region, planned to last until 2013. Upon completion, the iron ore miner’s annual ore handling capacity is expected to reach 155 million tons.

Construction of rail projects includes duplication of 120km of the mainline from Port Hedland, construction of 130km rail spur to the Solomon Hub, construction of four bridges, two new rail loops to deliver iron ore to Herb Elliott Port.

Image caption: Fortescue Metals is carrying out $8.4bn expansion in the Pilbara region by 2013 to increase its annual ore handling capacity to 155 million tons.