China coal deal with Australian miner questioned

His comments came after China Power International Development, a major electric company, denied it had agreed to a 20-year plan to buy coal from Palmer's Australian mining company Resourcehouse Ltd. Palmer initially said the deal was worth US$60 billion and would be Australia's biggest export contract ever.

“The company ... confirms that it did not contact nor negotiate with Resourcehouse Ltd. about any agreement and the company did not sign any documents, whether legally binding or not, with Resourcehouse Ltd.,” China Power said in a notice to the Hong Kong Stock Exchange.

Resourcehouse executives could not be immediately reached for comment. But a report by the newspaper The Australian on Tuesday cited Palmer as correcting his earlier announcement to say the deal was signed with China Power International Development's state-owned parent company, China Power International Holding.

Price negotiations had not yet begun, and the reported value of the deal was based on an estimate by Resourcehouse, The Australian and China's official Xinhua News Agency reported.

Palmer met with the Chinese company Tuesday and reaffirmed their commitment to work together, The Australian's report said.

Over the weekend Palmer said the two sides had agreed that the Australian miner would supply 33 million tons (30 million metric tons) of coal a year for 20 years.

The deal would net Resourcehouse the cash needed to exploit coal resources it holds rights to in northeastern Queensland state.

It also would help finance planned development of other infrastructure, including a 310-mile (500-kilometer) rail line and port facilities in Queensland's Galilee Basin.

A deal with China Power International, flagship of China Power Investment Corp., one of China's top five power companies, would be a coup for Palmer and would help him drum up financing. The company reportedly plans an initial public offering in Hong Kong later this year.

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