CITIC Pacific (Hong Kong stock code 0267.HK) is a Hong Kong-based conglomerate which is majority owned by China’s Citic Group in Beijing. Its activities span property, metals and mining, telecoms, and consumer products and its subsidiaries include CITIC Pacific Mining, CITIC Pacific Special Steel and Dah Chong Hong Holdings.
Australian iron ore project going into production, Citic Pacific says
Mining development is 4 years behind schedule and billions of dollars over budget
Citic Pacific said it was moving into the initial production phase at its US$8 billion iron ore project in Australia, following years of delays at one of China’s costliest offshore mining developments.
The project is already some four years behind schedule and billions of dollars over budget. Commissioning of the first of its two production lines has been going on since July, Citic Pacific, controlled by state-owned conglomerate Citic Group, said in an e-mailed statement.
“We are now moving into the production stage,” it said.
The project, one of the largest of its kind undertaken by a Chinese entity outside the country, has been marred by legal disputes. It has yet to generate any returns six years after Citic Pacific bought the rights from Australian tycoon Clive Palmer, prompting Beijing to take a much more cautious approach to approving foreign mining investments.
Citic Pacific said last month the focus over the next six months would be to ensure the stable running of the first production line and ramping it up to full capacity.
The firm had hoped to begin exporting iron ore in May. But problems at its grinding mill, a component in the production of the type of magnetite found in the far west Australian deposits mined by the company, forced it to delay.
The development aims to produce up to 24 million tonnes of iron ore concentrate annually. The material will be used by Citic Pacific’s own steel plants and also sold to other steel producers in China.
The cost of the project has swelled to almost US$8 billion from US$2.5 billion.