Dubbo business MAAS Civil has been awarded the first major contract for the Regional Rail Maintenance Facility.
The company will be responsible for bulk earthworks before the major construction starts later this year.
About 200 jobs are expected to be created during the construction phase of the $2.8 billion Regional Rail Project, followed by 50 ongoing jobs when it opens.
The announcement was made by Dubbo MP Dugald Saunders and Minister for Regional Transport and Roads Paul Toole on Tuesday.
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Mr Saunders said the facility would be a real boost for the economy and he looked forward to other businesses getting involved.
"One of the major advantages of having projects like this in our electorate is the ability to keep our workers in work, especially in the wake of prolonged drought and the COVID-19 pandemic," he said.
"This facility is a significant part of a multi-billion dollar project, and is a massive boost for Dubbo and the region."