Another court win for Hancock Prospecting

Gina Rinehart has reached a long awaited win in the High Court, which yesterday determined that Rio Tinto is liable for royalties to Wright Prospecting and Hancock Prospecting.

Under a deal struck between Lang Hancock and partner Peter Wright with Rio Tinto in 1970, Hancock Prospecting and Wright Prospecting were entitled to 2.5 per cent of iron ore sales from the Channar and Eastern Range mines.

Due to a break in Rio Tinto’s possession of the mines between 1974 and 1979, the UK major argued that its subsidiary Mount Bruce Mining was not liable for royalty payments.

The Mount Bruce Mining appeal was overturned by a unanimous decision of the High Court yesterday, with Rio Tinto liable for more than $200 million in royalties and court costs.

The case had already been made in an earlier NSW Supreme Court ruling against Mount Bruce Mining, which found that royalties of $89 million were owed for the Eastern Range mine only, leading both Wright and Hancock Prospecting and Mount Bruce to launch appeals against the decision.

The Channar mine is currently 60 per cent owned by Rio Tinto in a joint venture with Chinese company Sinosteel.

Rinehart has seen a tough year for her holdings, which were devalued by $6 billion over 12 months leading to the release of the 2015 BRW Rich List.

The Roy Hill mine was due to come online for shipping on October 21, however that date has been shifted back to the second week of November.

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