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Source: http://www.tradingroom.com.au/apps/view_breaking_news_article.ac?page=/data/news_research/published/2011/11/319/catf_111115_134100_8736.html


PERTH, Nov 15 AAP
November 15 2011, 1:41PM
West Australian Premier Colin Barnett says China will play hardball over joining the Oakajee port and rail project but he is optimistic it will go ahead.

China's sovereign wealth fund, China Investment Corp, is reviewing whether Beijing should step in to rescue the troubled project in WA's Midwest.

The $6 billion project hit a hurdle in August when joint-venture partner Murchison Metals admitted it could not fund its share of one of Australia's biggest infrastructure schemes.
It is intended the planned railways and port 20km north of Geraldton will serve as a transport hub for the region's vast ore reserves.

Mr Barnett said on Tuesday he had discussed Chinese involvement when he visited China in September.

"I believe they're going to take a fairly hardball position and I can understand that," he told ABC radio.

He said China was still smarting from being left out of the project initially.

"What I'm trying to do is find a way to bring China into the project in a formal sense.

"I think we're probably getting through that now and I urge them to become involved."

"I'm quite optimistic about this project (although) it is difficult."

Mr Barnett said the Chinese were not simply going to turn up with "a truckload of money" but were going to place very strict requirements on their investment.

He said if a December 31 restructure that included all interested parties was achieved, he was confident Oakajee would go ahead.

He said it would be worth the effort.

"The bottom line is that there is 13 billion tonnes of iron ore in the Midwest. One way or another that's going to find its way to market. It is simply too valuable a resource."