Billionaire Clive Palmer offers green light to save mine after court rejects his $941m unpaid royalties claim

Billionaire Clive Palmer is willing to clear the way for the biggest Chinese-owned mine on Australian soil to continue operating after suffering a Supreme Court setback.

CITIC's Sino Iron magnetite mine.

Billionaire Clive Palmer says he is willing to clear the way for the biggest Chinese-owned mine on Australian soil to continue operating in a breakthrough that has the potential to save about 3000 jobs.

Mr Palmer’s private company Mineralogy has written to subsidiaries of Chinese conglomerate CITIC at the 11th hour, stating it will agree to a mine continuation proposal for the $US12bn ($18.80bn) Sino Iron magnetite operations on the West Australian coast.

CITIC suggested Mr Palmer’s offer was another smokescreen with numerous deletions and omissions to the plan it had put forward, and unlikely to prevent further court action.

Mineralogy owns the mining tenements that are home to the Sino Iron operations and has been in a standoff with CITIC over the mine continuation proposal since 2023.

CITIC has warned the operations may have to shut down unless Mineralogy submits the mine continuation proposal to the WA government, with time running out to save thousands of jobs. 

Mineralogy wrote to the CITIC entities with the peace offer deal on Tuesday – the same day Mr Palmer’s bid to lodge a counterclaim for $941.5m in unpaid royalties was rejected by a Supreme Court judge.

Clive Palmer outside the WA Supreme Court last week.

The ruling represented a victory for CITIC ahead of a trial crucial to the future of Sino Iron that is due to start on Monday.

CITIC is seeking orders compelling Mineralogy to submit mine continuation proposals to the WA government as required under a state agreement covering the project that represents China’s biggest investment in Australia.

In its letter, Mineralogy gave CITIC until 5pm on Thursday to respond.

Mineralogy said it reserved all of its rights in respect to other legal battles raging with CITIC, and provided a heavily edited but otherwise unchanged version of the CITIC mine continuation plan it is willing to green-light.

The letter, signed by Mr Palmer, suggested CITIC parties should discontinue the trial due to start on Monday.

In regard to those proceedings, Mr Palmer tried to claim unpaid royalties on 134 million tonnes of ore he said CITIC had “trashed”.

He said the low-grade ore should have been processed, while CITIC argued it was just waste rock and accused the billionaire of trying to delay the trial.

Justice Michael Lundberg on Tuesday rejected Mineralogy’s bid to add the counterclaim against CITIC and its subsidiaries in the “home stretch” before the trial.

Mr Palmer is estimated to pocket more than $1m a day in royalties from the Sino Iron operations.

Justice Lundberg said there was “a real public interest in the ongoing dispute between the parties regarding the submission of new MCPs (mine continuation proposals) being resolved as soon as possible”.

Layers acting for CITIC said the Mineralogy amendment application was a “concoction which has been put together as a desperate last act to try and defeat this hearing”.

Justice Lundberg said Mineralogy had raised its allegations at a very late stage in proceedings that had been listed for trial since September 2024 and that the explanation for the delay in bringing the application was extremely weak.

“To be clear, I do not accept, and I do not find, that this application was developed as a device by the first defendant (Mineralogy) or Mr Palmer in order to forestall the trial of the action,” he said.

Justice Lundberg said it was open to Mineralogy and Mr Palmer to launch a separate case to pursue a claim for any unpaid royalties.

Mr Palmer told The Australian on Wednesday that he was weighing up that option.

CITIC's Sino Iron magnetite mine.

Mr Palmer said Mineralogy only received the information it needed to properly assess the mine continuation proposal in February.

“We’ve now been able to add material (about the mine) that the court ordered them to hand over to our assessment of their proposal and get our experts to look at it,” he said.

“That’s taken them about eight weeks. We think as far as going forward in respect of this matter, subject to the various reservations we’ve got, we should give them an approval, and we’ve done that.”

Mr Palmer said the ball was now in CITIC’s court.

A CITIC spokesman said Mineralogy had all the information required as far back as 2023.

“At any time in the past 20 months Mineralogy could have submitted our proposals. Instead, Mineralogy has waited until now to provide a document that contains pages of unexplained deletions and removes much of the content required by the state agreement,” the spokesman said.

“Mr Palmer’s attempts to blame the delays on CITIC are inconsistent with the objective history of the matter. Given that the trial of this matter is currently listed to commence next week, any further comment at this stage would not be appropriate.”

The two parties are involved in a separate legal battle over CITIC’s attempts to secure more land on Mineralogy tenements.