16 companies interested in offtake agreements for Resourcehouse...

16 companies interested in offtake agreements for Resourcehouse !! COME ON ARH, THEY ARE OUT THERE !!


CLIVE Palmer's Resourcehouse will try to lock in an offtake agreement for its West Australian iron ore project after it lists, in a change to the policy detailed in the group's prospectus.

Resourcehouse, which aims to raise up to $3.6 billion from investors ahead of a listing on the Hong Kong Stock Exchange on June 10, says in its prospectus: "We do not intend to enter into any offtake arrangements (on the iron ore interests) as our current intention is to sell our iron ore on the spot market."

But asked how the lack of offtake agreements could affect the cost of debt funding for the project, which Resourcehouse forecasts will cost $2.7bn to develop, Mr Palmer said the group did intend to eventually have an iron ore offtake agreement.

"At the moment we've got about 16 offers to take all of the iron ore, and with the IPO, the press conference today, we haven't had time to come across, sit down and make sure we get the very best return for shareholders. That's what we want to do," Mr Palmer said at the launch of the company's IPO earlier this week.

Start of sidebar. Skip to end of sidebar.
End of sidebar. Return to start of sidebar.
"We do intend to get full offtake for the iron ore, which will be volume take-or-pay."

Resourcehouse has signed agreements with China Power International and trading house Vitol over all the forecast production from its $8bn China First coal plan in Queensland's Galilee Basin. Mr Palmer attacked what he described as "laughable" reports critical of the Resourcehouse offer and the time it would take for the projects to get into production. Operations are both forecast by Resourcehouse to be in production by the end of 2014.

Mr Palmer said the combined businesses would be generating between $4.5bn and $5bn in cashflow when they were in full production.

He rejected criticism that the structure of Resourcehouse -- which does not own its mineral licences but holds contracts to mine fixed volumes from projects that will remain under Mr Palmer's ownership -- would limit shareholders' access to upside.

"We're not an exploration company that goes and finds minerals -- we acquire projects, we acquire deposits, and we accelerate them with the support of (Chinese state-owned enterprises) and state-owned banks," he said.