cfe and citic pacific

Citic Pacific joins list of potential part ners for Cape Lambert’s ore



JOHN PHACEAS



Citic Pacific, the China-backed conglomerate headed by Hong Kong billionaire Larry Yung, has joined the queue of international groups casting an eye over Cape Lambert Iron’s namesake magnetite project on the Pilbara coast.
Cape Lambert chairman Ian Burston yesterday confirmed that Citic, 29 per cent owned by China’s biggest State-owned international trading group, would meet the company to discuss the massive project.
Mr Burston said it was too early to comment on the nature of Citic’s interest, which comes in the wake of its $290 million payment for the mining rights to a billion tonnes of magnetite at Clive Palmer’s Cape Preston project, 80km to the southwest.
Citic said last week it was pushing full steam ahead with plans for a $US2.5 billion ($3.18 billion) magnetite mining and processing venture at Cape Preston where it also has options to acquire the mining rights for another five billion tonnes of magnetite from Mr Palmer’s Mineralogy group.
Citic’s interest in Cape Lambert also comes just weeks after the WA magnetite hopeful released fresh drilling results which confirmed the potential for a significant increase in the current JORC-compliant magnetite resource of more than 2.5 billion tonnes.
Citic is now the third major Chinese group eyeing the project, joining specialist pipemaker Xingxing Iron Pipes and Beijing-controlled SinoSteel as prospective partners.
Cape Lambert has also been negotiating with Indian steel maker Essar Group for seven months about a potential equity and offtake agreement for the project.
Essar has also expressed interest in building its own 7.5 million tonnes a year pellet plant at the site, which lies just 10km from Rio Tinto’s existing iron ore port at Cape Lambert.
Details of Citic’s interest remain scant, though it is possible the company believes there is potential to establish two separate mining operations linked by an 80km slurry pipeline.
Cape Lambert’s current plans for its massive magnetite resource envision a $500 million-plus mine and concentrator producing 15 million tonnes of high-grade magnetite concentrate a year by early next decade.