Clive Palmer suffers yet another setback for Queensland mine project after $40 billion contract terminated
Friday, May 11, 2012/
Mining billionaire Clive Palmer has hit another roadblock in his attempt to get one of the world’s biggest coalmines off the ground, after a deal with another business to buy $40 billion worth of coal has reportedly now been abandoned.
This is the latest setback associated with the billionaire’s company Resourcehouse, which Palmer has attempted unsuccessfully to float numerous times.
The China First coal mine, Resourcehouse’s pet project, was once dubbed the country’s biggest export deal when it was announced alongside Queensland Premier Anna Bligh back in 2010.
Swiss energy company Vitol had agreed to buy half of all coal production at the mine, but it has now said the contract has been terminated, according to Fairfax.
However, Palmer also told the publication that he was responsible for terminating the contract and that the development “had no impact on the project”.
However, Fairfax reported some big contracts that were originally in place are no longer in play, or have been abandoned, including an initial letter of credit from China Exim Bank.
The other half of all coal to be manufactured at the mine, located in Queensland’s Galilee Basin, will be sold to China Power International Holding. Palmer says it remains committed.
Palmer has previously said the project will create 6,000 jobs and will generate over $4.5 billion in export revenue. But it comes as massive miners, including BHP, are backing off from coal due to higher prices and labour costs.
And this isn’t the first setback for the project. Earlier this year, Palmer said China First wouldn’t start exporting coal until 2015, despite initially projecting a start date of December 2014.
Resourcehouse has suffered a number of abandoned initial public offering plans, the most recent being last year when Palmer attempted to win billions from Hong Kong investors. Prior to that cancellation, he had already publicly touted the idea of dropping back the size of the float.
That was the company’s fourth attempt at a Hong Kong listing since 2009. Before the mid-year float, it had attempted to go public in March 2011.