Business

Court rules on coal royalties dispute

IT WAS a battle of dynasties when a case regarding billions in royalty payments landed in the Supreme Court this week.

Gina Rinehart's Hancock Prospecting fought off a demand that Wright Prospecting be paid 1.25% of coal royalties - $1 billion over three decades.

The challengers gave the Hancock firm rights to the Galilee Basin's "Kevin's Corner" mine site in 1998.

It is now owned by Indian resources giant GVK and the future site of a $6.6 billion mining project.

More than 4500 workers will be needed to build and operate the project if it is eventually approved.

Ms Rinehart's father Lang Hancock and Wright Prospecting founder Peter Wright pioneered the lucrative iron-ore industries in Australia as great mates.

Under this "Hancock and Wright" partnership, they owned Kevin's Corner.

However, each of the groups were now in regular courtroom skirmishes that intensified after a court in 2010 ordered Ms Rinehart to give 25% of her "Rhodes Ridge" iron-ore project in Western Australia to the Wright heirs.

Court documents showed contracts signed between Wright and Hancock in the 1980s agreed to give each party 1.25% of coal value royalties if a mine was ever developed on the Queensland site.

If GVK made good on its plan to export 30 million tonnes of heating coal for three decades from Kevin's Corner - and based on a price of A$90 per tonne - that percentage would amount to more than $33 million in royalties per year.

In total, it would deliver $1.012 billion to the Wright company by the time the mine was exhausted.

In the Queensland Supreme Court on Monday, these claims were struck out.

It did maintain that the mine was a Hancock interest free of Wright's demand for royalties.

However, Justice Margaret McMurdo would not dismiss the entire case on Monday. She described the dispute as "long-standing and complex".

Wright Prospecting may launch another case, but it will have to rely on new claims.

Both Hancock Prospecting and Wright Prospecting declined to comment on the case.

Topics:  coal royalties, galilee basin, hancock prospecting, kevin's corner


Local Real Estate

finda logo
Featured Real Estate
Thoughtfully Designed... $360,000
Villa 3 1 2
Mortgagee in Possession... Offers Over...
Residential Land 0 0
Potential Plus In A Top... $239,000
House 3 2 1
Sonaisali on Alice... Offers Over...
House 4 2 3

Join the Community.

Get your local news, your way.

Stay Connected

Update your news preferences and get the latest news delivered to your inbox.


Marketplace

Sponsored Offers

Compare & Save