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Ex-Im’s project for Australia’s ‘corporate welfare queen’ reportedly ‘set for very large losses’
Washington,
February 10, 2015 -
Several months ago this blog noted that Australia’s richest citizen secured a nearly $700 million loan for a new mining project from American taxpayers thanks to the U.S. Export-Import. Now the Australian Business Review is reporting that the project “is set for very large losses.”
In the short term, the capital costs for Gina Rinehart’s Roy Hill mine are almost certain to blow out — and a lower iron ore price will make matters worse.
If the current iron ore price decline continues into 2017 and beyond, then Gina Rinehart’s massive $10 billion Roy Hill mine project is set for very large losses when it starts production next year.
And if the reports of safety problems in the construction phase are right, then the capital costs will blow out beyond $10bn, especially if unions start playing hard ball, as they often do when there is a safety cause.
Now we know why banks & investors wouldn’t take the risk – but, American taxpayers did. #ThanksExIm
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