Billions at stake in iron ore wars
Dozens of letters between iron ore pioneers Lang Hancock and Peter Wright could help decide which of their descendants get to hold potentially billions of dollars in iron ore assets and royalties.
Dozens of decades-old letters between iron ore pioneers Lang Hancock and Peter Wright could help decide which of their descendants get to hold potentially billions of dollars in iron ore assets and royalties.
The legal fight between some of Western Australia’s wealthiest families over portions of the iron ore empire built by Hancock and Wright formally began on Monday when dozens of lawyers flooded the state Supreme Court for a trial more than a decade in the making.
Lawyers for Wright Prospecting, or WPPL – the business owned by the billionaire descendants of Wright, including daughter Angela Bennett and grandchildren Leonie Baldock and Alexandra Burt – began the laborious process of detailing dozens of letters, telexes and assorted correspondence between the two founding fathers of the WA iron ore industry.
Wright is arguing it should be entitled to hundreds of millions of dollars of royalties from the Hope Downs iron ore mine, now mined by Rio Tinto in part of its partnership with Gina Rinehart’s Hancock Prospecting, or HPPL.
It also believes it should be entitled to a share of the iron ore deposits known as East Angelas, a stake likely worth well over $1bn.
Watching it all play out are lawyers for the various Rinehart children, including the two adult children – John Hancock and Bianca Rinehart – who are fighting with their mother over the structure and spoils of the Hancock empire.
With a hint of irony, given the 10 years the case has taken to get to trial and the months set aside to hear the proceedings, Wright Prospecting barrister John Rowland KC said “WPPL’s case is a relatively simple one … WPPL and HPPL were, and to this day remain, partners”.
First, agreements put in place by Hancock and Wright decades ago spelt out, the legal team says, an arrangement where one family would pay royalties to the other if their respective iron ore deposits ever made it into production. That has not happened since Hancock’s Hope Downs came into production.
Second, Wright lawyers say, East Angelas should be an asset held jointly by the two families, not, as is the case, solely by Hancock. The East Angelas iron ore deposits were identified in the late 1960s and assessed by the Hanwright venture established by Hancock and Wright, but by the early 1970s the WA government had informed the pair their hold on the ground would be ending.
The government had formed a view that its best hopes of building a steelmaking industry lay in attracting large multinational corporations to the state with the deep pockets and technical capability to develop the infrastructure. There was also some concern about the danger of having so much of the iron ore industry tied up in the hands of the duo.
The stripping of East Angelas triggered aggressive lobbying by both Hancock and Wright. Letters were sent to the premier and prime minister seeking input on overturning the decision and returning the assets to the pair’s Hanwright partnership. Tellingly – in the eyes of Wright’s lawyers – the bulk of correspondence was under the Hanwright letterhead.
Dozens of those letters were tendered on Monday as the barristers for Wright began a week-long opening address. It was Julie Taylor SC’s role to begin the painstaking task of walking the court through the convoluted history of the East Angelas deposits, as recorded through the extensive correspondence between Hancock, Wright and others.
One letter from Hancock to Wright details how he had seen then-premier John Tonkin “with his tail down” after the government had stripped them of East Angelas and spelt out how he was taking the fight to the “anti-Hanwright faction”. Later correspondence from Hancock to Wright detailed how “we are winning the battle” to get East Angelas back.
More than a decade later, that prophecy came true. However, Wright argues tenements that should have been shared between Wright and Hancock remain solely in the hands of Hancock.
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