$1.2 billion Chinese mining investment for Palmer

Mining magnate Clive Palmer has bounced back from yesterday’s criticism of his company by securing $1.2 billion in funding from a major Chinese bank for its $8 billion project in Australia.

The new project will include the construction of a coal mine and infrastructure project and Palmer says despite assumptions the project was in doubt due to Resourcehouse’s suspension on the Honk Kong stock exchange yesterday, the China First Coal project still has financial and government support.

“We have struck back quickly with a deal which ensures the project’s viability and puts to rest the unfounded criticism of some media and analysts,” Palmer said.

He said China Exim Bank had reinforced its commitment to the development of the China First project in the Galilee Basin in Central Queensland at a crucial time by approving a buyer’s credit facility.

“China Exim Bank has confirmed to China First Pty Ltd, a wholly owned subsidiary of Resourcehouse Limited, their willingness and interest to finance the project,” he said.

“The facility amount has now increased to 85 per cent of the total amount of the construction contract after originally providing for 70 per cent.

“The extra 15 per cent means the funding has increased from $5.6 billion to $6.8 billion.”

Palmer said the support from China Exim Bank and the Chinese Government was a positive for the company, so soon after the disappointment of the Resourcehouse Initial Public Offering, which failed to close due to falling markets in Asia and the United States.

“After closing off the IPO as a result of volatile market conditions, we are still in a position of strength to advance this project,” he said.

“Within 24 hours we have secured an extra $1.2 billion in funding coupled with the ability to access a further $600 million for equity.

“As a result of the Global Offering, we also have a number of international companies who wish to make direct investment into Resourcehouse for equity in the company, giving us confidence that we will fully fund the project.

“This is a win-win-win for Queensland in terms of job creation, export earnings and mining royalties.”

The China First Project includes a large scale thermal coal mine in the undeveloped Galilee Basin coal region near Alpha, west of Emerald.

The complex will include four underground mines, two surface mines and associated coal handling and processing facilities.

The mine will be linked to a new coal terminal at Abbot Point near Bowen by a new 471km standard gauge, heavy haul railway line.

The mine and associated infrastructure will create 6,000 jobs during construction and 1,500 during operation.

The China First coal mine and infrastructure project and an iron ore project in Western Australia will both supply the Chinese market, which Palmer has always been supportive of.

Last week he labelled Australia “outstandingly racist” for its attitude to Chinese investment.

“There is growing demand for our coal and iron ore resources, particularly in China and India, and this demand will continue,” Palmer said.

“Our projects will bridge the gap between the rapidly growing demand from China and the supply of first class resources.”

In December, Palmer announced his plans to source at least 10 per cent of his workforce for a coal development in the Galilee Basin from China.

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