Clive Palmer: having it all

WITH a mining empire to run and a replica Titanic to build, not to mention a child to raise, Clive Palmer is very busy. Next project: politics?

Clive and Anna

BEING Clive Palmer means the phone rings at 5am and he peels off the breathing mask, trying not to wake Anna or little Mary.

He boots up the laptop to find 150 emails have thudded in overnight. The radio talkshows are chasing him again. He needs to get to his weigh-in and then into the office for a management meeting and a teleconference with the team in Perth. Being Clive Palmer means there's never enough time in the day.

It means that just about everyone is trying to second-guess what the big man will do next. Direct another meaty jab at Tony Abbott or Wayne Swan? Run for federal parliament? Try again to sell Hong Kong's sceptical financiers on his king-sized coal mining venture in Queensland's Galilee Basin?

Right now, he's talking about the Titanic II. It's a signature Palmer project: bold, outlandish, out there. Way out there. He wants to build a replica of the doomed ocean liner in a Chinese shipyard before retracing its ill-fated maiden voyage across the Atlantic, this time with a Chinese naval escort. Exactly why is not clear. Palmer tugs at his $23 trousers from Lowes menswear - they're loose thanks to the 26kg he's shed since starting sleep apnoea treatment, hence the breathing mask - and leans back in his chair, chuckling. "When you get older, get in the twilight of your life like me, it's common for Australians to build a boat or a caravan or take the Women's Weekly round-the-world trip, right. It's the sort of fandance we do as Australians, right. So in my case I just wanted to build a boat like any other bloke would."

Right, Clive. Being fabulously, not-a-care-in-the-world rich, with an estimated fortune of between $795 million and $3.85 billion, lavish homes in Queensland, Beijing and Perth, private jets on tap, a Bentley in the garage and the royalties set to flow from his iron-ore venture with the Chinese in Western Australia, he gets to do and say pretty much what he likes. If the alternative prime minister has the temerity to suggest he would be a "part-time" MP, then Palmer says he's perfectly entitled to call Abbott a "lightweight". It's stating a fact, right, and he has said much worse about other politicians, especially his bete noire, Treasurer Swan. "I meant Tony was lightweight in the context of boxing," he explains, his eyes twinkling.

"I'd be a heavyweight in that sense. I said the Treasurer was an intellectual pygmy but I didn't call Tony Abbott that."

Even Palmer's friends talk about his chaotic management style, but it's surely a reflection of the eclectic business empire he runs from wherever he happens to be. In addition to his mining investments he owns a nickel refinery near Townsville, resorts in Tahiti and on Queensland's Sunshine Coast, a gas and oil concession off Papua New Guinea, a thoroughbred stud and, of course, the shipping company that is building a fleet of massive bulk carriers, along with Titanic II, in Nanjing's CSC Jinling Shipyard.

Still, to hear Palmer talk - which is an awful lot these days - you do wonder how much he is having us on. There's his curious story about being bounced on the knee of Mao Zedong as a boy and meeting the last emperor of China, Pu Yi, while being shown around the Forbidden City by none other than Chou En-lai, Mao's urbane acolyte. In his view, asylum seekers should be able to fly direct to Australia to stake their claim to stay. The Liberal Party, he asserts, has a conflict of interest in having paid lobbyists sit on its executive, yet he would cheerfully keep control of his companies were he elected to parliament, assuming he's sincere about that, which many doubt.

He's all for free speech when it comes to needling fellow billionaire Frank Lowy over his stewardship of Australian soccer, a Palmer obsession since his A-League team, Gold Coast United, had its licence revoked and folded. But it's another matter for The Sydney Morning Herald to report that his prospective Galilee coal mine had lost an important contract; Palmer, who claims to have a personal scorecard of 68-0 when it comes to litigation, called in the lawyers.

(The action is ongoing; the paper has filed notice in the Queensland Supreme Court of its intention to defend it.) The political establishment has no idea what to make of Palmer, and nor does big business. His critics say he has never really left behind his past as a real estate salesman; he routinely promises more than he can deliver, they sniff; he's a chancer, a "typical cowboy [who] likes to talk big words", according to one Chinese media outlet.

And yet, here he is, at 58: happily married to Bulgarian-born Anna, who is 20 years his junior, and recently a new father. They cut an intriguing couple. She is as formidable as he is in her unassuming way. Qualified in chartered accountancy and law, Anna has put her career on hold for their precocious four-year-old, Mary, and a husband who is wealthier, better known, more irascible and influential than ever.

"I wouldn't describe it as difficult," she says, when asked about their helter-skelter lifestyle. "It's probably, ah, exciting." No wonder there's a spring in his step. Perhaps the very best thing about being Clive Palmer is that it's a whole world of fun.

So why would he do it? Trade the billionaire lifestyle for the lot of a rookie MP, under the thumb of the party whips, not to mention a leader who's not exactly wild about the Clive for Canberra idea. His friend, business associate and Liberal National Party president Bruce McIver - reputed to be one of the few people to whom he listens - says Palmer is "deadly serious" about running for federal preselection for the LNP. Despite this, McIver has urged him to reconsider: "I think he's got enough on his plate. He's got huge business ... he's got huge interests and, yes, I've told Clive that."

Geoff Smith, the boyhood mate who became his in-house lawyer, says Palmer detests authority. "He just doesn't like being told what to do," is how Smith put it on ABC TV's Australian Story recently. Palmer seems genuinely taken aback when asked about this.

"Well, Geoff is a different person, a very conservative person," he says. "He works on the status quo, Geoff does. I don't." He pauses to gather his thoughts. "Look, if I come across authority that is pushing someone's ideas down, saying someone can't express them, it doesn't matter to me if they are right or wrong or if they lose. I see that as a great challenge. Always have."

Tell that to Abbott. He felt the lash of Palmer's notorious temper when they clashed at a Melbourne hotel on a chilly Thursday night in June. By Palmer's account, Abbott had sought the meeting after learning that Palmer intended to move a motion at the Liberal Party's forthcoming Federal Council to boot paid lobbyists off its executive. This was in line with LNP policy in Queensland, but Abbott wasn't buying it. Two federal vice-presidents, ex-Howard government ministers Alexander Downer and Santo Santoro, are registered lobbyists and potentially would have been compromised. The federal president and former Victorian treasurer Alan Stockdale was also in the frame, having for a time been listed as a lobbyist in Melbourne. (This was a technicality, Stockdale insists, and he never performed paid lobbying).

Abbott, according to Palmer, asked him to back off. Words were exchanged - short, sharp and largely unprintable words, by Palmer's telling of it. He later apologised to Abbott for the language, but not for the substance of what he said. It was a matter of principle, he insists. "The basic gist was that Tony said he wasn't going to stand by while his president and vicepresidents were embarrassed and he couldn't allow me to put up that resolution. That invoked a very definite response from me ... I know Adolf Hitler wasn't in favour of people being able to put forward resolutions but I didn't think we were in Nazi Germany in 1939."

Abbott, while declining to go into detail about who said what, noted pointedly that Palmer was "just an ordinary rank and file" party member, with no more or less influence than anyone else. The spat lifted the lid on a seething cauldron of tensions within the Liberal Party, centred on Palmer and his allies in the LNP. (The Liberal and National parties are folded into the LNP at the state level in Queensland, but it is constituted as a division of the Liberal Party federally).

There's history to this, dating back to Palmer's earliest foray into conservative politics. Palmer was 29 and already rich when Joh Bjelke-Petersen ripped up the state coalition agreement and formed a historic National Party government in Queensland without the Liberals. He decided to get involved and by 1986 was the Nationals' official spokesman, just as BjelkePetersen's horizons were broadening. The Queensland premier's bid to switch to federal politics turned into the ill-fated "Joh for PM" campaign, which helped sink John Howard at the 1987 election and destroy the first iteration of his leadership. The irony is that Palmer was never on board: he tried to talk BjelkePetersen out of Joh for Canberra.

Yet to some senior Liberals, the most recent events looked like another wrecking ball was swinging out of Queensland, this time towards Abbott. Other factors were in play. Palmer was talking up McIver as the "best party president" in the country, forcing Abbott to intervene, again, to head off a challenge to Stockdale. (McIver, who has confirmed he was considering the idea, promptly dropped it).

At the same time, Palmer fanned speculation about his own political ambitions. It's fair to suggest there was more than a measure of mischief to this. Originally he had flagged his interest in running against Swan in his Brisbane seat of Lilley after the Treasurer denounced him, along with fellow mining plutocrats Gina Rinehart and Andrew Forrest, as a threat to democracy in an essay for The Monthly magazine. He backed out on July 3, the day nominations for LNP preselection closed in Lilley, but insisted he would seek endorsement elsewhere in Queensland. For a time there was talk - which, naturally, he fostered that he would go up against Bob Katter in his north Queensland stronghold of Kennedy. Palmer let the speculation run for several days before closing down that unlikely option. (Katter holds the seat with an 18.3 per cent buffer).

Next, he was eyeing the Sunshine-Coast seat of Fairfax, where long-serving incumbent Alex Somlyay is retiring at the general election due in the second half of next year. Palmer bought into the area big time last year when he snapped up the Hyatt Regency Coolum resort for a reported $70 million. True to form, he is keeping everyone guessing about his intentions. The LNP won't choose its candidate for Fairfax until November and McIver isn't being drawn on what his friend might do. "Clive's his own man," he says.

Which brings us back to this: why would Palmer want to go to Canberra? Abbott set out what would be expected of him on July 4, at the height of their public bickering. Candidates had to do the "hard yards" of doorknocking; they had to be out first thing in the morning at the bus stops and the railway stations; and they had to support party policy. "The other thing I would hate to see is any suggestion that being in parliament is a part-time job," Abbott said, with Palmer clearly in his sights.

The man himself mulls over the question. "I'll give you the answer, honestly," Palmer says, and proceeds to explain that he had been supporting the National Party since he was at Queensland University, sleeping rough on the floor at Union College because he couldn't afford the fees. Now, as a life member of the LNP, who had paid something like $70 million in personal taxes, he was entitled to stand for parliament.

Right, Tony. Right, Swannie. "Look, I'm a citizen of Queensland," he says. "If I've got ideas to contribute I should be able to [do] that outside of parliament, inside of parliament, or anywhere. We don't attack poor people because they are poor, and we shouldn't attack rich people because they are rich. We don't want those divisions in society."

In some ways it would have been no surprise had Palmer ended up in the ALP. He grew up in workingclass Williamstown, then a grimy pocket of shipyards and factories in Melbourne's inner west. His father, George, was quite the character; he made silent movies before founding the commercial radio station 3AK. That launched him into the orbit of Joe Lyons, the one-time Tasmanian premier and Depression-era treasurer who quit the Labor Party before becoming Australia's 10th prime minister.

In 1962, at the height of the Cold War and the famine that gripped China in the aftermath of Mao's disastrous "Great Leap Forward" into industrialisation, George somehow secured an invitation to visit the country. In what capacity, Palmer won't say; his late father swore him to secrecy. When he was ushered into Mao's presence, the Great Helmsman is supposed to have joked about the nationality of the eight-yearold sat upon his knee. Australian? "Running dogs of the US imperialists," he said, by Palmer's account. As with many of his stories, this is impossible to verify. (Palmer failed to produce photographs purportedly taken of the meeting). It's possible, though, to see how he could tie these diverse strains into a narrative.

The family moved to Queensland and he found his place in the sun on the Gold Coast. After dropping out of university - he had toyed with studying journalism - the young man talked his way into a job in real estate. He retired after making $40 million, which he thought was more than anyone could ever spend.

But by the mid-'80s, bored and piling on weight, he was back at work mixing business with politics. He set up a number of businesses including Mineralogy, his principal private company. Palmer faded from public view after the Fitzgerald Inquiry destroyed Joh and the reputation of just about anyone associated with the Bjelke-Petersen government. But Palmer was never going to stay in the background; it's not his style.

Swan's campaign against the mining magnates might have been intended as a call to arms to the ALP's downcast base, but it certainly exercised Palmer. He is routinely depicted by Labor as "owning" the LNP in Queensland. It's rubbish, he says, and McIver furiously agrees, saying Palmer's funding of the conservative cause is much overstated.

While he gave $300,000 to the federal Liberals and two cheques totalling $550,000 to the LNP through Mineralogy and a second company, Queensland Nickel, in 2010-11, the flow of cash has since slowed, McIver insists. Palmer kicked in $143,000 in sponsorship for the last two LNP conventions but only $5000 in direct donations since January 1, 2011.

Palmer, for his part, rejects the suggestion he has ever tried to buy influence. "I've been around for 40 years in business and I have never asked anyone outside to do anything special for us that shouldn't be done for any member of the community or a company in our position," he fumes. "I don't get any favours. In fact, it's the opposite. Every politician wants to make the point that 'I'm not reacting to Clive Palmer', because they are reacting to something that's been said about me, usually by the Labor Party."

Although then premier Anna Bligh enthusiastically backed his Galilee project, standing by his side when he announced in 2010 the "biggest export contract in Australian history" to supply $60 billion worth of coal to state-owned electricity generator China Power International (CPI), her LNP successor Campbell Newman has doggedly kept his distance.

Delegates to the Liberal Federal Council on the last weekend in June took careful note of Newman's speech, delivered the morning after Palmer's motion to ban lobbyists was brusquely slapped down. Coincidentally or not, the official Liberal Party video cut to Palmer, head-down in his seat, as the premier noted that the government had reduced the number of rail corridors proposed for the Galilee. What he didn't say was that this had been partly at the expense of Palmer's China First project at Alpha North, 1050km northwest of Brisbane. His message was that environmental standards would not be compromised and it seemed to have a distinctly personal dimension: "In Queensland, it doesn't matter who you are, the environment will be protected," Newman declared.

Palmer confirms he is not personally close to the new premier (who declined to be interviewed for this article); "Why should we be?" he breezily asks.

He doesn't try to hide his annoyance at the state government's recent decision to snub his company in favour of the joint-venture of Rinehart's Hancock Prospecting and India's GVK to develop the key rail corridor to the new Galilee opencuts, including his $8 billion China First project. "The Premier ... made certain undertakings publicly to us and to the Chinese," he huffs, referring to Bligh, not Newman.

"And the Queensland Government is not going to walk away from any of those things ... We are still building that corridor."

The deal is the biggest of Palmer's career and was to have been partly financed by the float of his mining interests in Hong Kong through a new vehicle, Resourcehouse. The initial public offering failed for a fourth time last year. Never mind. He now says he didn't need the $3.35 billion it was to have raised. The ExportImport Bank of China was locked in, along with the national government, and he claims to have the letters of intent to prove it. "We don't need equity now ... I went to Resourcehouse because I was a bit lazy."

Palmer's conversation is littered with fantastic numbers. A billion tonnes of ore to be mined here, $10 billion to be made there, and it sometimes takes a leap of faith to go along with him. Exactly how much he is worth is a matter of contention. BRW magazine recently estimated his fortune at $3.85 billion, down from $5 billion last year owing to the failure of the Resourcehouse listing. Forbes, more conservatively, puts it at $795 million.

He won't nominate a figure, except to say it's higher than any of the published estimates. He conducts business through an opaque web of private companies.

Arguably, his prime asset is the vast Cape Preston iron-ore development in the Pilbara. He got hold of the tenement in 1986 after its US owner failed to pay the rent. The killer deal came later, when he sold the mining rights to CITIC Pacific, China's biggest special steel maker.

In addition to exacting an upfront payment of $200 million for the first billion tonnes of iron ore mined, he will receive a hefty royalty of 10 per cent, amounting to an estimated income of $20 million a month. Former Rio Tinto executive Michael Komesaroff, an expert in the Asian minerals trade who now consults to most international mining houses, says the going rate is more like 2 per cent. "He's been persistent and lucky and to some degree you make your own luck by being persistent," Komesaroff notes.

Palmer says CITIC Pacific Mining has pumped more than $6 billion into developing the vast mine, port and processing plant at Cape Preston and will be shipping ore by early next year, triggering the royalty flow.

Komesaroff is not alone in wondering whether the Chinese are as chuffed as Palmer is with the terms. "It reminds me a bit of Kerry Packer's comment on Alan Bond after he offloaded [Channel] Nine all those years ago: you only get one Bond in a lifetime."

Jason West, a former investment banker who lectures at Brisbane's Griffith University, specialising in the resource sector, can't discern the strategy behind Palmer's hyper-investing. Without a rail corridor, the coal mine in the Galilee basin amounts to a "stranded asset", he argues. True, Palmer picked up the Yabulu nickel refinery on the cheap in 2009, reportedly paying BHP Billiton around $200 million. (Many in the industry believe it was far less, but the details are confidential.) Margins in nickel processing are notoriously tight and BHP was said to have been anxious to unload it at a time when prices were particularly flat.

"He's got a good eye for an asset ... he sees value where others don't," West concedes. "But I'm not sure what his business plan is. Very little is transparent."

Having known him for a decade, McIver says he's no longer surprised by anything Palmer says or does. That's not a criticism, the LNP boss hastens to add. "I understand the man ... he does some things that he probably regrets at times, like we all do. He's just got one of those brains that works differently from other people. He comes up with solutions a normal person mightn't think of."

McIver is a director of Asia Pacific Shipping Enterprises, Palmer's shipping operation. A contract for the construction of four 64,000-tonne bulk carriers was signed with the CSC Jinling Shipyard on July 19. McIver's expertise is in transport logistics and he had suggested to Palmer that they backload the freighters transporting nickel ore to Yabulu from New Caledonia and the Philippines. Instead, Palmer decided to build his own ships - and tacked on the Titanic II. Jinling spokesman Li Wenbao confirms work is proceeding on the replica. "We're preparing ourselves for the next concrete step," he tells The Weekend Australian Magazine.

So is Palmer. Those close to him believe he is looking to his legacy. His son, Michael, 23, is involved in the business as a director of Queensland Nickel, the company that operates the Yabulu plant. He has put other relatives into other senior roles, entrenching his control whether he stays in the CEO's chair or not.

For all the scepticism about Clive for Canberra, politics may well beckon. Palmer insists that those who represent him as a businessman who dabbles in politics have it the wrong way round: "I've been a member of the Liberal National Party for longer than Tony Abbott, for longer than Campbell Newman," he says. Yet Labor takes him sufficiently seriously to have factored him into its routine polling. The results are not all that good for Palmer. An online focus group run in March by UMR, the ALP's private pollster, found that only 26 per cent of men and 16 per cent of women had a positive view of him; many more said they had never heard of him.

Anna answers warily when asked what's next for her impossibly busy husband. She is soft-spoken, slightly built in contrast to his still formidable 122kg bulk, and evidently uncomfortable with the attention. They were friends long before their feelings for each other deepened. In 2006, she lost her husband, Andrew Topalov, whom Palmer had walked her down the aisle to marry, while he was bereaved by the death of his wife of 22 years, Susan (the mother of Michael and 17-year-old Emily). Cancer took both partners.

The couple married in 2007, and Mary came along a year later. They travel with Palmer from home to home, deal to deal. "She gets up excited every morning ... the first question is, 'where are we going today, Mum?'" Anna says. They are seated in the marbled foyer of the former Hyatt Regency Coolum - renamed the Palmer Coolum Resort - as the staff keep a prudent distance. The far wall is plastered with photos of him with the great and the good: Newman, a beaming Kevin Rudd and, of course, Joh, back when he was a sleeker, dark-haired version of himself.

It's near the end of another long day and the usually blustering billionaire is in a reflective mood. Perhaps he is aware that the clock is winding down to when he must put up or shut up, and choose between politics and business. "The most valuable thing in life we've got is time," he is saying, as Anna nods in agreement. "Not money, right? I mean ... if you ever speak to somebody who's dying and you say, 'Would you like to have one more day or would you like a million dollars?' what do you think they'll say? I'd go for a day anytime."