Australia’s richest woman Gina Rinehart has quietly shut down her Mongolian mining exploration operation.
Company documents filed in Singapore show that the billionaire’s Hancock Prospecting group wrote off its Mongolian investment last year because of “management’s intention to wind up the subsidiary company in the near future”.
Meanwhile, Ms Rinehart has hinted that her major iron ore project in Western Australia, Roy Hill, could begin exporting earlier than expected.
In a statement published on the Roy Hill website over the past 48 hours, Mrs Rinehart suggested the September 2015 target for first exports could yet be beaten.
“Roy Hill’s staff morale is high, and the hard working team hope to be able to bring the first shipment, due September 2015, ahead of time,” she said.
Closure of the Mongolian venture was confirmed by a Hancock Prospecting spokesman on Tuesday.
“Hancock Prospecting did assess mineral tenements in Mongolia in recent years, however chose not to pursue any and has no current interests in Mongolia,” he said.
The decision to withdraw comes at a time when investor sentiment towards the land-locked Asian nation has deteriorated markedly.
Shares in most Australian miners exploring in Mongolia have plummeted over recent years, and Rio Tinto’s attempts to build a major new copper and gold mine there continue to be hampered by government disputes.
A separate Rio Tinto subsidiary with exposure to Mongolian coal – SouthGobi Resources – has struck a series of problems in the nation, and declared earlier this week that it may not have enough funding to meet its obligations.
Details of Mrs Rinehart’s Mongolian operation emerged in financial accounts lodged last month by Hancock Prospecting subsidiary Hancock (Singapore).
The accounts, for the 2013 financial year, appear to show that the Mongolian company, Hancock Prospecting Mongolia, was the Singapore arm’s only substantial asset, worth about SGD125,000 ($107,000).
Hancock’s country manager appears to have been William Sanders, a graduate of Missisippi State University, who claims on his LinkedIn profile to have “supervised all internal and external operations” for Hancock Prospecting Mongolia.
He says he held the job from September 2011, when the exploration office was opened, to March 2014 and “conducted and oversaw the initial due diligence work on over 100 exploration and mining tenements covering several million hectares of land”.
Hancock Prospecting Mongolia appears to be separate from Ms Rinehart’s other investments in the country.
In 2011 she reportedly bought small stakes in two listed Australian companies exploring for coal in Mongolia, Aspire Mining and Guildford Coal, worth a total of $3 million.
Mrs Rinehart’s optimistic comments about Roy Hill come despite the main engineering and construction contractor, Samsung C&T, winning a 46-day extension to its contract earlier this year.
That change saw the “practical completion” date for the project pushed back from November 15, 2014 to December 30, 2015.
The Roy Hill team has always denied that the contract extension would delay the first exports from the project, and insisted the September target would be met.
Roy Hill is expected to export a maximum of 55 million tonnes of iron ore per year at its peak, but will initially export less.
Mrs Rinehart noted in the statement that Roy Hill was bucking the trend in the mining industry, where big new construction projects are becoming rarer than during the past decade.
“This is a project that will employ thousands of Australians for decades and earn much needed export revenue for Australia. Roy Hill is currently the largest single mainland construction project in Australia,” she said.
SOURCE: Sidney Morning Herald