Citic Pacific criticises tycoon Palmer over Australian iron ore dispute

Citic Pacific took a public swipe at Australian billionaire Clive Palmer yesterday over his attempts to halt its long-delayed and massively over-budget US$8 billion iron ore project in Australia.

The Sino Iron project, China's biggest offshore mining investment, was to be a key prong in Beijing's strategy to ease its dependence on the world's dominant iron ore producers, Vale, Rio Tinto and BHP Billiton.

But instead it has been a disaster for Citic Pacific and its contractor, Metallurgical Corp of China (MCC), as they ran into regulatory hurdles, labour shortages, disputes over hiring Chinese workers, safety issues and soaring costs.

To add to its woes, Palmer, who sold the rights to the ore to Citic Pacific, has sued it for what he says are hundreds of millions of dollars owed in royalties and tried to block Citic's port access.

Citic Pacific president Zhang Jijing was frank yesterday about the poor relationship.

"Any claim that we haven't paid our fair share in accordance with agreements is just plain rubbish," Zhang told an audience of mining industry executives, bankers and lawyers in Melbourne.