Australasian Resources Negotiations between Clive Palmer’s...

Australasian Resources

Negotiations between Clive Palmer’s Australasian Resources and state-owned Chinese steel company Shougang Group are expected to wrap-up sometime this week, despite the spanner thrown in the works when a senior Shougang executive was arrested in connection with claims that Rio Tinto was engaged in espionage. Tan Yixin, the head of Shougang's iron ore trading unit, was said to be intimate with Stern Hu, Rio's chief iron ore price negotiator. Hu was arrested in Shanghai last week along with three other Rio employees.

Australasian is no longer in exclusive talks with Shougang, but the company is said to be the only bona fide party, along with billionaire Palmer, interested in funding the company's Balmoral South project at Cape Preston in the Pilbara. China Metallurgical is not thought to be a likely partner for the project, Australasian's flagship, despite its involvement in building CITIC Pacific's Sino Iron Ore mine, also at Cape Preston. It’s said to be a case of too many eggs in one basket. China Metallurgical is arranging debt funding for Palmer's Waratah Coal and recently walked out on another Palmer project, Gladstone Pacific Nickel.