Palmer kicks Chinese off Sino Iron project

Clive Palmer's Mineralogy has served a notice terminating mining rights Citic Pacific currently has at the Sino Iron project in WA.

It has given a 21 day notice for the Chinese firm's rights.

According to the miner it comes on the back of actions taken by the Hong Kong Government to start legal proceedings against the former chair of Citic Pacific and five directors over recent losses.

This is latest in a series of moves since 2012 that has seen Mineralogy and Citic come to blows over Sino Iron.

The project initially saw serious delays and was unable to meet a range of pre-arranged targets and royalty payments, with Citic stating at the time that the lack of Australian experience for its Chinese lead contractor MCC was partly to blame for the delays and,

The relationship between Palmer’s Mineralogy and Citic Pacific took another turn over the issue of mining royalties.

This series of events prompted Palmer to try and pull out of the agreement, in which he owned the land and gave CITIC Pacific mining right, until Mineralogy was awarded royalties.

However this was vetoed by the WA Supreme Court.

The issue of royalties again reared its head mid-last year, after Palmer claimed the Chinese miner was finally paying him royalties, to the tune of $500 million.

“We have a standard right-to-mine agreement,” Palmer said at the time.

“In the agreement it says they pay a royalty when ore is taken. We would say that word ‘taken’ means when you mine it — they would say it means when you take it from Australia.”

Now the focus of this ongoing battle between the two companies has turned to the control of Cape Preston and control of the rights to the land.

Since these initial blowouts disagreements have flared between Citic and Palmer's company, with the Australian billionaire famously accusing the Chinese firm of 'raping' Australian resources, and then filing numerous court applications to force Citic into liquidation.

Now Mineralogy is attempting to serve a termination on the rights owned by Citic.

"Not only has Citic Pacific Limited failed to rectify the defaults in the notice, the directors of Citic Pacific failed to declare the default notice to the market in Hong Kong and may have breached the law," Clive Mensink, Clive Palmer's nephew and director of Mineralogy, stated.

“The Hong Kong Stock Exchange and authorities should immediately commence an investigation into the failures of Citic Pacific and its directors to declare the default notice in 2012 and the current Termination Notice to the market in accordance with the law and rules of the Hong Kong Stock Exchange.

“Not only has Citic Pacific Limited failed to disclose important material facts to the market, they have sought suppression orders and obtained from Australian court orders to suppress information from the market and Citic Pacific shareholders.

“The current Board is suppressing information in the same way the former Board did. Five of those directors are now facing action from the Hong Kong authorities.”

Mensink went on to say that despite the fact Mineralogy served the notice on 12 September Citic has not informed the market.

"Mineralogy had evidence that the current board of directors’ accounts from Citic Pacific Limited had misled the market and Mineralogy was considering making a complaint to the Hong Kong authorities," he said.

“Some of the current directors of Citic Pacific were also directors at the time of the actions, which are the subject of the legal proceedings the authorities have commenced against the company’s former chairman and directors.

“One must wonder why those directors have not also been subject to legal proceedings brought by the authorities."

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