doing fifo financially smart
HomeMining Industry News Palmer vs Citic over $10b in royalties

Palmer vs Citic over $10b in royalties

Tuesday 1st of September 2015 08:24:08 AM



Clive Palmer and his estranged business partner Citic Limited have reached another level in their legal war, with Mr Palmer's company Mineralogy seeking $10 billion in damages from the Chinese giant.

Mineralogy is suing Citic over what it claims to be a lack of royalty payments from Citic's Sino Iron project in WA, which was built on Mr Palmer's leases.

The two companies have previously argued over royalties, which has been complicated by the agreement signed between the two companies in May 2006 which relies on the annual benchmark iron ore prices struck by BHP Billiton and Brazilian miner Vale to calculate one of the royalties owing to Mineralogy, known as "Royalty B".

With iron ore now traded on daily market terms rather than on annual contracts, there is no way to calculate Royalty B.

The two companies have battled it out over numerous things, including access to the port used by the loss-making Sino Iron project and the shifting of millions of dollars out of certain accounts, but it seems the battle has returned to the original issue of royalties.

"The simple fact is that Citic Limited continues to export iron ore concentrate from Western Australia and refuses to pay Mineralogy the royalty," said Mr Palmer.

A spokesman for CITIC Pacific Mining said the matter was already before the Supreme Court of Western Australia.

"This is yet another claim lodged by his companies since the Federal Court dismissed Mineralogy's attempt to terminate key port agreements at the Sino Iron project," the spokesman said.

"Like the other claims, it overlaps matters being addressed in other proceedings … We look forward to having the validity of these latest claims scrutinised by the courts and will continue to protect the interests of the project, our company and shareholders."

Sino Iron has two magnetite processing lines operating near Cape Preston in Western Australia and expects to commence production from two more this year.

"In the meantime, export operations are unaffected and we're focused on ensuring the project reaches its full potential," said the spokesman for Citic.

Mr Palmer has vowed to step back from his business interests since entering federal parliament, but at a press conference in Brisbane on Monday, he made a point of announcing he was speaking as the former director of Mineralogy.

"The Chinese practice is to try and bankrupt Australian companies and squash them," Mr Palmer said.

"To ensure there is a proper respect for our country and our companies and commercial litigation, we think it is about time to bring these people to account, through the courts, for the amount of money which is properly owing to us."

Mr Palmer said the $10 billion figure was "the net present value of the royalties" which Sino Iron and Korean Steel were "obliged to pay under their agreements with Mineralogy, over the life of those agreements".

"This actually relates to the fact that they are operating on our mining leases in Western Australia now, loading up Australian resources into Chinese ships, shipping them back to China without paying for them," he said.

"This is purely in respect to money that they owe us, for minerals that they have taken from Australia back to China, and not paid even one cent for."

Mr Palmer accused Citic of issuing "worthless" guarantees.

"The fact that Citic is one of the largest banking groups in China raises serious questions over the operation of the banking system in China and how Australian companies can rely upon it," he said.



Source

Recent Related News

New coal mine reveals plans

Thursday 5th of January 2017 11:25:42 AM

130 kilometres north-west of Rockhampton plans are underway to develop the Styx Coal project which will potentially look to the region for up to 500 workers. Fairway Coal and Styx Coal, wholly owned subsidiaries of Mineralogy Proprietary Limited, are behind the proposal. Managing director of ....


Sino Iron Pilbara project will deliver, Citic Pacific CEO says

Tuesday 14th of June 2016 08:47:32 AM

The head of Citic Pacific Mining has skirted allegations that its Sino Iron project in the Pilbara is facing financial difficulties. The mine, rail and port operation has only just been fully completed costing more than $10 billion and several times the original target budget. Citic Pacific ....


Palmer vs Citic over $10b in royalties

Tuesday 1st of September 2015 08:24:08 AM

Clive Palmer and his estranged business partner Citic Limited have reached another level in their legal war, with Mr Palmer's company Mineralogy seeking $10 billion in damages from the Chinese giant. Mineralogy is suing Citic over what it claims to be a lack of royalty payments from Citic's Sino ....


Court Hears Mineralogy Not Approved to Operate Port

Thursday 11th of June 2015 06:27:38 AM

The Federal Court in Perth has heard that CLIVE Palmer's mining company Mineralogy never received approval to operate a Pilbara iron ore port which has recently been placed in government hands. The Court heard that the regulation of Cape Preston port is now being handled by the Director-General of ....


Citic and Mineralogy dispute over port

Thursday 4th of June 2015 07:04:17 AM

Citic has told the Federal Court it is not operating or shutting anyone out of a West Australian iron ore port in its dispute with Mineralogy. Clive Palmer’s company Mineralogy claims there has been a breach between an agreement with it and Citic and is trying to strip Citic of its right to use ....


Y Fronts teaser banneriComplii MiningLink prefered resume writers Civil Link Banner
Electricians Mt Pleasant Operation
G&S Engineering is applications from experienced Electricians, to join our CDJV team at the Mount Pleasant Operation.

Recruitment Administrator
Recruitment Administrator required to support high volume blue collar recruitment. Full time permanent role. Join our team now!

Category Manager
Bis Industries is seeking a proactive and enthusiastic Category Manager to join its team based in Osborne Park.

Store Person Outstanding Mining Company
Outstanding mining company seeking an experienced store-person to commence immediately for 4 to 6 weeks.

Forklift Operatorstoreman In Processing Factory
Experienced Forklift Operator required for Production Company. Manual laboring also required.

Prelude Arrives In Australia
Shell Australia's Prelude floating liquefied natural gas (FLNG) facility has arrived in Australian waters this week after its 5,800km journey from the Samsung Heavy Industries shipyard in Geoje, ....

Australia's Largest Testing Rig Unveiled In Rocky
Siemens has invested $5 million into the Rockhampton Service Centre, which unveiled this week, Australia’s largest and most advanced gearbox load test rig for mining, wind power and other core ....

Dinosaur Find At Qld Mine Site
Palaeontologists and volunteers will work over the next month excavating and studying 30,000-year-old dinosaur bones at the South Walker Creek mine in Central Queensland. The team of eight people, ....

Black Thoated Finch Puts New Coal Mine At Risk
The controversial black throated finch is back to cause problems for Adani with a fresh legal challenge over the planned Carmichael coalmine. New advice has found the federal environment ....

Monadelphous Awarded $55M In Contracts
Monadelphous Group Limited announced on Wednesday it has been awarded a number of new work packages with a combined value of approximately $55 million. The engineering company will carry out ....