Resourcehouse, the Australian coal and iron-ore
project developer planning a
Hong
Kong
listing next month, said at the
weekend it had signed
Australia
’s largest export contract worth US$60bn with China Power International
Development.
The 20-year sales agreement is for thesupply of
30m tonnes a year of coal worth “approximately” US$3bn a year.
The agreement underlines
China
’s
growing demand for Australian coal and iron ore and also
Beijing
’s
desire to expand its supplier base beyond BHP Billiton and Rio Tinto, the
Anglo-Australian mining groups.
During the depths of the global financial crisis,
two-way trade between
China
and
Australia
jumped 30 per cent to a record A$83bn.
“This deal with CPI is
Australia
’s
biggest ever export contract,” said Clive Palmer, the Australian billionaire
and chairman of Resourcehouse.
Mr Palmer also announced that he had awarded
Queensland
state’s largest engineering, procurement and construction management contract,
worth US$8bn, to Metallurgical Corporation of
China
.
MCC last week said it planned to buy US$200m
ofshares in Resourcehouse, equal to less than 5 per cent of the
Australian group’s equity before its initial public offering. MCC also agreed
to buy a 10 per cent stake in Resourcehouse’s US$8bn coal development project,
called China First.
The Export-Import Bank of
China
willlead the financing of the China First project, contributing US$5.6bn.
”This is
Australia
’s
largest single, non-syndicated, finance deal,” Mr Palmer said. “The interest
from
China
highlights the strength of the project and the benefits for
Queensland
and
Australia
in developing a new world-class coal region.”
Resourcehouse twice delayed a Hong Kong IPO last year
but the miner is now planning to raise up to US$3bn in an initial public
offering. Resourcehouse has declined to provide details on its proposed IPO
before a formal timetable is set.
Resourcehouse plans to spend more than
A$10bndevelopingcoal mines in Queensland and iron ore deposits in
the Pilbara region of Western Australia.
However, both projects have a number of hurdles to
pass, including various federal and state government approvals, and
massive infrastructure spending.
China First plans todeveloped coal in the
Galilee
Basin
in
central
Queensland
. It will include four underground mines, two surface mines and
associated coal handling and processing facilities.
Resourcehouse plans to link the mine to anew
coal terminal on the
Queensland
coast via a new 490km rail line. The mine and associated infrastructure
will create 6,000 jobs during construction and 1,500 during operation.
China First hopes to begin coalshipments in 2014
and plans to produce as much as 40m tonnes a year. Analysts have estimated the
project could be worth more than US$4.2bn.
Li Xiao Lin, chairwoman of China Power International
Development, said the China First Project would open up a “massive new coal
resource and the CPI Group of companies are pleased to be involved”.
CPI develops, constructs, owns, and manages
large-scale power plants in
China
.
The electricity generated by CPI power plants supplies Eastern China Power
Grid, Central China Power Grid and Northern China Power Grid.
Resourcehouse also hopes to become Australia’s
fourth-largest iron ore producer behind Rio, BHP and Fortescue. It has rights
to mine an estimated 10bn tonnes of iron ore in the Pilbara.