Huge debts mean Hastie creditors to get little

THE administrator of Hastie Group has dashed lingering hopes of substantial returns for creditors, signalling that few businesses of the once-sprawling engineering services company will find new owners.
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Speaking after a creditors’ meeting in Melbourne, Ian Carson, of PPB Advisory, said Hastie’s debt bill included $100 million owed to ”many thousands of creditors”, with rural and regional suppliers particularly hard hit. This amount is in addition to $500 million owed to banks that funded its acquisition binge.

Many creditors travelled from regional areas to hear it was unlikely they would receive ”any extensive” return, given the debt to banks. These creditors included labour hire firms, and suppliers of plastic fittings and guns for fastening, some of whom were owed ”serious amounts” of up to $500,000, Mr Carson said.

”They’re really normal, ordinary businesses … and a lot of them are locals. You know, Albury and Shepparton, regional areas,” Mr Carson told a media conference after the meeting. He described the mood of the meeting as ”sombre”.

Mr Carson said of the 44 businesses under Hastie’s control, just five had been sold for a combined sum of less than $30 million, and another one or two may be sold for modest amounts.

Receivers and managers McGrathNicol, appointed by Hastie’s banks, have taken charge of Hastie’s stronger assets, but Mr Carson was downbeat on the prospect of substantial returns from the sale of those companies.

”It’s hard to imagine there being a material return even after McGrathNicol,” Mr Carson told BusinessDay.

Asked whether he had greater

insight into the cause of Hastie’s collapse, Mr Carson said: ”There have obviously been some failures, whether it’s corporate governance or other things.”

He estimated about 1200 jobs had been saved across Hastie’s local workforce, now under PPB’s remit, of the 2700 stood down, excluding the 1800-odd at companies taken over by McGrathNicol.

A spokeswoman for McGrathNicol said yesterday there was no update on its sale process for Spectrum Fire and Safety, Hastie Services, industrial refrigeration systems company Gordon Brothers Industries and Austral Refrigeration. Austral was for sale when Hastie collapsed.

The secretary of the Plumbing Trades Employees Union, Earl Setches, said the vast majority of its members had held onto work and their entitlements in Victoria. He said of the 600-odd Hastie workers in the state, just a handful were now out of work. Of the 350 members directly affected in NSW, he estimated 300 were back in work.

Hastie had about 7000 workers globally when it collapsed last month, after the discovery of a long-term accounting ”irregularity” foiled a recapitalisation plan.

Mr Carson said legal action related to the collapse had not been his focus but he would be meeting with directors and shareholders in the months ahead. Listed litigation funder IMF (Australia) and law firm Slater & Gordon have confirmed they are keeping an eye on the collapse.

There was a 150-day extension sought for the convening period before the next creditors’ meeting, Mr Carson said.

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Tackling the Tax Office over its interpretations

THE Australian Taxation Office has long been the elephant in the room when it comes to business, investment, superannuation and financial matters. What is often not appreciated is how much the ATO uses its weight and size advantage to squash taxpayers into submission in its pursuit of maximising tax collections.
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The ATO achieves this in two ways. The difference between the two methods primarily comes from when the ATO employs them. Under the first method tax assessments are issued based on the ATO’s interpretation of the law and either result in tax deductions being disallowed, amounts received being classed as taxable income, or applying a higher tax rate.

An example of this last method was when the ATO during the 1980s charged taxpayers that had lost their jobs an extra tax on lump sum termination payments received. In this example the ATO, despite a great deal of evidence to show its interpretation was incorrect, was forced into doing the right thing by the passing of amending legislation. The second method is far more effective as it involves the ATO issuing rulings and guidelines that affect decisions made and actions taken by taxpayers. This is done by the ATO issuing statements, meant to help taxpayers understand certain aspects of the law, which are not backed by either case law or legislation.

These rulings place an interpretation that maximises tax revenue collection. By issuing these rulings the ATO uses its size, and the genuine fear of taxpayers and professionals of being dragged into a protracted dispute, to effectively rewrite tax legislation and reinterpret tax cases.

A recent example of how the ATO uses both of these methods relates to the taxation of family discretionary trust income. In March 2010 the High Court handed down a decision in favour of a taxpayer in a dispute with the Tax Office that has become known as the Bamford case.

The case revolved around a discretionary trust’s ability to distribute different types of income, such as capital gains and franked dividends, to different beneficiaries in set amounts. The ATO had issued an assessment based on its interpretation that was challenged by the taxpayer.

The High Court ruled in favour of the taxpayer. At the heart of the judgment, the High Court decided that what a trust could do was decided more by trust law and the deed setting up a trust, and not by the ATO trying to place a self-serving interpretation on tax law. The judgment in this case also led to amending legislation that also forced the ATO into applying the decision of the court to all trusts.

In response to the court case in the new legislation the ATO recently issued an income tax ruling. The ruling is again placing an interpretation on tax law designed to force trustees and professionals into acting in a way that again potentially maximises tax revenue collections.

Allan Swan, a tax law specialist with Moores Legal, said: ”The ruling has stretched beyond recognition the High Court’s view of what constitutes trust income for a family trust or a deceased estate. There is no mention in the Bamford decision that the definition of trust income cannot be set to match the income tax definition.”

With recent comments from the left wing of the Labor Party and the increasingly pugnacious attitude of the ATO towards trusts, trustees have two options. The first is to sit back and cop whatever comes their way. The second is to voice their objection and communicate this to their member of Parliament.

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Rinehart lifts her stake in Fairfax

Mining magnate Gina Rinehart.MINING magnate Gina Rinehart has increased her hold on Fairfax Media in a sharemarket raid that has taken her stake in the publishing house to more than 15 per cent.
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After months of her ratcheting up pressure on the board to deliver her two board seats, market sources believe Mrs Rinehart, already the company’s largest shareholder, has lifted her stake by about 2 per cent to 15-16 per cent.

The world’s wealthiest woman is believed to have bought at least half of the 78.7 million shares traded yesterday – quadruple the normal trading volume – including a single line of 42 million shares sold at lunchtime for 60¢ a share.

A spokesperson for Mrs Rinehart declined to comment, but all major investors are required to advise the stock exchange if they buy or sell more than 1 per cent of the company within two days.

Mrs Rinehart is believed to have appointed brokers Bell Potter to buy more shares in Fairfax (owner of The Age and The Sydney Morning Herald) in her bid to lift her stake to 19.99 per cent – the maximum allowed before a shareholder needs to make a takeover offer.

The more shares Mrs Rinehart buys, the harder it becomes for the board to resist her push for seats, particularly if she wins approval from other institutional investors.

A fellow major shareholder, funds management group Allan Gray, which also recently lifted its shareholding to more than 9 per cent, has previously expressed qualified support for Mrs Rinehart. Managing director Simon Marais has called for an overhaul of the company, saying the board needed a tough outsider to shake things up and that Mrs Rinehart might be the right person.

Mrs Rinehart has been an outspoken critic of the board and management of the company, along with her close adviser Jack Cowin, who has been tipped as Mrs Rinehart’s choice for a second board position.

Sydney radio network owner John Singleton, a friend of Mrs Rinehart’s, told The Age yesterday the board’s refusal to give her a seat was ”the worst corporate insult I’ve ever seen”.

Late last month, Mrs Rinehart refused to speculate on whether she would lift her stake as the company’s share price slumped to record lows, saying: ”It is too early to say if Hancock Prospecting [the company through which Mrs Rinehart

owns her stake] will hold its more than 13 per cent shares in Fairfax or sell them or find some other satisfactory resolution.”

Hancock Prospecting chief development officer John Klepec said this week that the board should demonstrate its commitment by buying more shares.

”If the chairman and board are true believers in the strategy to assist the company, surely they would have a reasonable percentage of their net worth in Fairfax and be taking opportunities to add to this when the opportunity arises,” he said.

”We understand, for instance, that the chairman only has 99,206 shares and has not added to his shareholding.”

Michael McCarthy, chief market strategist at CMC Markets, said the share price, which has fallen nearly 85 per cent in the past five years, demonstrated that investors did not believe the company had sufficiently embraced the opportunities presented by online media.

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Rumours fly in flimsy market

Perpetual became the focus yesterday when questioned by the ASX over a share-price spike.WHEN markets dramatically retreat the way the local market has done in the past three months and share trading volumes dry up, talk often turns to takeovers. Sometimes it is a case of hedge funds, brokers and investment banks trying to generate interest in a stock to make some money, and at other times it is because the share price has fallen so low that it becomes an obvious target.
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In the local equities market, volume yesterday was a woeful $3 billion, which is well below the typical daily average of $4.5 billion. To put it into some context, at $3 billion it is 45 per cent lower than last year’s average and more than half the daily average of the peak in June 2007 which was $6.6 billion a day. Such low average value trades per day coupled with a falling equity market – down 7 per cent in the past three months – is not only hurting the stockbroking industry, with some players struggling to meet their overheads, but it has turned the spotlight on stocks that have either had a sudden share price surge or above-average turnover.

Yesterday morning Perpetual became the focus when it was queried by the ASX over a share-price spike following rumours that an unnamed private equity fund was looking at making a bid. It prompted the ASX to issue a query, to which Perpetual responded with a stock standard answer that it was unaware of any explanation for the price rise other than the market reaction to media speculation about an interested buyer. Nevertheless, the stock closed almost 10 per cent higher at $23.79.

The other stock in focus yesterday was Fairfax Media, when 42 million shares were put through at 12.28pm by Southern Cross Equities at 60¢ a share. At the close of trade, another 36 million shares had changed hands.

The share bulge naturally raised speculation that the company’s biggest shareholder Gina Rinehart was increasing her stake beyond 13 per cent with the aim to go towards 19.9 per cent, which is just below the takeover threshhold, to improve her chances of getting a seat on the Fairfax board. (Fairfax is owner of The Age).

But Fairfax and Perpetual are not alone. Other companies that have been the subject of market speculation include Qantas, Echo and Pacific Brands. In some cases a bid will emerge. In others, though, it will be an attempt to spread the rumours to generate business or inflate the share price. There is no doubt that investment banks, stock brokers and hedge funds are doing it tough. It would not surprise if some investment banks were flying kites in the form of speculation to gauge industry interest in certain companies, while in other cases the rumours are being spread by hedge funds trying to game the market. In other cases, the share price has fallen so low that it becomes affordable for private equity and other trade buyers to make a tilt.

For instance, CSR’s shares fell to a 25-year low yesterday, putting it on a market capitalisation of $766 million. It will be interesting to see if rumours emerge of a takeover offer for CSR. In the case of Qantas, its shares fell below $1 last Friday, making it an attractive takeover target. And in the case of Echo, the recent emergence of James Packer’s Crown and Genting on the register has inflated the share price by at least $1. Whether the rumours translate into something more concrete, time will tell. But what is certain is that over the next few months there will be more rumours as investment banks and stockbroking firms try to keep their heads above water as markets continue their wild volatility until Europe sorts itself out.

The hope is that the Greek elections on Sunday will produce a stable government that will help settle investor fears. But that is a big hope. For starters, there is still the issue of Spain, which wasn’t helped by Moody’s decision overnight to downgrade its rating on Spanish government debt by three notches to Baa3 from A3.

Moody’s is concerned that the newly approved eurozone plan to help Spain’s banks will increase the country’s debt burden. But there are bigger problems bubbling away.

Spain has said there will be minimal conditions but only Spain knows what they are and is expected to unveil them after the Greek elections. This has led some market watchers to believe that the bailout was announced to encourage Greeks to vote sensibly at the weekend. As one observer said: ”The bailout announcement would no doubt encourage Greek voters to elect candidates this weekend who would keep Greece in its austerity program. That is, look how bad things are – even Spain needs a bailout.”

The upshot is the Greeks will learn about the Spanish rescue conditions after they have voted. If the conditions are not to their liking, watch out Europe.

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Sydney Airport to land more tourists

Low-cost airlines like Scoot are providing extra lift for Sydney Airport.SYDNEY Airport was ”stepping up its role” in the tourism space, said chief executive Kerrie Mather, and there had already been wins with the arrival of low-cost Asian airlines AirAsiaX and Scoot.
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At a business lunch yesterday in Sydney, Ms Mather signalled closer co-operation with Tourism Australia and New South Wales Tourism.

She said she had travelled to India as part of the NSW Tourism delegation and was hopeful that direct flights to India from Sydney would eventuate. She had also just returned from China, which was a ”market with potential for us”.

Ms Mather said last year 640,000 passengers from China came through the airport and this year China would move to second place, behind New Zealand, as the dominant country for the airport’s visitors.

She reiterated that Sydney Airport Corporation welcomed the federal government identifying a future airport site for a second Sydney Airport and securing transportation corridors, but said the existing airport could deal with demand through until 2045.

Last week the corporation issued legal proceedings against the federal Minister for Transport, Anthony Albanese, after the government brought forward to mid next year a deadline for the airport to produce a draft master plan.

Ms Mather said the airport was consulting about a new plan it announced in December last year, which will see a reconfiguration of the airport, including moving the jet base and air traffic control tower, and integrating domestic and international flights from the same terminals.

”We are halfway through that period of consultation so we were on track delivering our master plan by 2014,” she said. ”It is important we incorporate [this vision] in the master plan, so we need time to work through.

”So we have asked for the reasons why the master plan has been bought forward.”

The airport had discussed with Qantas buying back its long term leases for its jet base and terminal, which were not due to expire until 2019, considering that the Qantas sites took up 30 per cent of the airport’s footprint, she said.

Discussions had already resulted in some suggested improvements, which dealt principally with productivity issues, she said.

Ms Mather said the train station access fees on the privately owned Airport Link remained an impediment and she wanted to see both the removal of the fee and improvements on the line, such as better provision for passengers carrying luggage. The NSW government has said it will release later this year a discussion paper on transport for the airport and Port Botany area.

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Nagging doubts as LionGold stalks its quarry

Will Castlemaine Goldfields have a bar of the LionGold offer?SHAREHOLDERS in Castlemaine Goldfields have more than 16 million reasons to proceed with caution as they ponder a takeover offer from their Singaporean suitor, LionGold.
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LionGold has been collecting gold assets around the world over the past year, and in early April offered two LionGold shares for every nine Castlemaine Goldfields shares in an all-scrip deal.

LionGold has promised to use its financial might to unlock extra value in struggling Castlemaine’s assets, which include the historic Victorian goldfields, scene of the Eureka Stockade in 1854.

But yesterday’s release of the Bidder’s Statement has raised doubts about LionGold’s financial strength, with a significant portion of the company’s finances tied up in overdue payments from an opaque private company based in the Marshall Islands.

LionGold confirmed that a private company, Enchante, had repaid barely 15 per cent of the more than $19 million it owes LionGold.

LionGold blamed delays in getting money for Enchante’s failure to pay the outstanding $16.39 million, and LionGold conceded in the Bidder’s Statement that there was some risk of Enchante defaulting on the debt.

Earlier this year when bidding for another ASX-listed goldminer, Signature Metals, LionGold conceded that Enchante had no accounts or financial statements that were publicly available for inspection. The outstanding $16.39 million is triple the $5.48 million of cash that LionGold has on hand, and comprises about half the $32.6 million that LionGold expects to have on hand by the end of 2012.

But LionGold’s chief operating officer, Errol Smart, told BusinessDay yesterday the company had dealt closely with Enchante in the past and had ”strong comfort that that money will be forthcoming” before the end of the year.

Mr Smart said LionGold had easily completed a recent convertible bond raising for $US23 million, demonstrating its ability to get finance when needed.

”We are not concerned at all about access to finance,” he said.

”We do have other avenues of financing as and when required.”

Castlemaine’s non-executive chairman, Gary Scanlan, also pointed to that raising as proof that LionGold could get funds, despite the difficult economic conditions.

He said the takeover offer was a case of ”relative risk assessment” for Castlemaine shareholders, and he stood by his recommendation that shareholders accept the offer.

Investors did not appear to be deterred by the state of LionGold’s finances, with Castlemaine shares closing half a cent higher at 15.5¢. The stock was fetching closer to 9¢ before the takeover offer was launched in April.

Aside from Castlemaine and Signature, LionGold has tried to get the private Australian gold explorer Brimstone Resources, which holds leases in Western Australia and Victoria. Other acquisitions have been for assets in Mali, Ghana and might soon include Bolivia.

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Greiner denies buy conspiracy

FORMER New South Wales premier Nick Greiner has denied allegations of bid-rigging brought against him by an investment company controlled by a Russian oligarch.
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Pala Investments, registered in the Swiss canton of Zug but ultimately controlled by Russian billionaire Vladimir Iorich, is suing Mr Greiner in a lawsuit also targeting the mining services company he chairs, Bradken, and the company’s chief executive, Brian Hodges.

In a lawsuit filed in May, the Swiss group alleges Bradken, Mr Greiner and Mr Hodges conspired with US private equity group Castle Harlan to buy cheaply an Australian subsidiary, Norcast Wear Solutions (NWS), which competed with Bradken.

However, in a response filed with the court on Tuesday, Bradken, Mr Greiner and Mr Hodges denied their ”commercial dealings” with Castle Harlan broke Australian competition law.

In addition to his role at Bradken, Mr Greiner sits on the board of Castle Harlan’s Australian affiliate, CHAMP.

While Castle Harlan is not a target of the Federal Court lawsuit, Pala last week filed a similar claim against it in the Supreme Court of New York.

In the Federal Court, Pala alleges Bradken and Castle Harlan reached an understanding that Castle Harlan would buy NWS, which makes liners for grinding mills, and then on-sell it to Bradken. Castle Harlan bought NWS in July last year for $190 million and that day flipped it to Bradken in a deal that earned it $US25 million.

Mr Greiner and Mr Hodges told the court Bradken learnt from Goldman Sachs that NWS was for sale in February 2011 but believed that it was excluded from the sale process because it was a direct competitor.

Bradken informed Castle Harlan about its interest in NWS and gave Castle Harlan a deposit towards the purchase of NWS on the same day the private equity group agreed to buy the company, they said.

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Creditors uneasy over transfer of Reed contract

CREDITORS owed up to $80 million by the embattled Reed Construction group are concerned that a contract Reed holds on the Law Courts project has been transferred to another company owned by Reed founder Geoff Reed.
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The transfer this week heightened concerns that Reed is on the brink of seeking voluntary administration.

Law Courts Limited said yesterday it had agreed to a proposal by Reed Construction Australia to novate the construction management contract Reed held for works at the courts to RBG Holdings Group Pty Ltd, the holding company for the Reed Group. It stressed that the overall $300 million project was with firm LCL, not Reed.

It said the measure would ensure continued employment of Reed Constructions project staff, ”retaining significant experience and knowledge of the project in its final stages”, and would also put in place a mechanism that retained all existing employment entitlements for the Reed workforce.

Law Courts said it provided ”the most certainty for the project to continue uninterrupted and avoids lost time and additional costs given the current circumstances surrounding Reed Construction Australia. Law Courts Limited intends to complete the project using the existing resources and contractors on site.”

The novation of the contract comes at a tense time for the company and its subcontractors and suppliers, many of which have not been paid for six months. Reed faces a wind-up application in the New South Wales Supreme Court next week from three creditors.

Reed’s future was under new pressure last week as the NSW Department of Education said it did not owe it money under Building the Education Revolution. Reed claimed substantial sums were owed under BER, and from road projects. Reed said last week it was still negotiating its BER claims.

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India’s boom now gloom

A chastised government is promising shelter from India’s economic storm.THE ”India rising” story was supposed to be one of uninterrupted growth, an irrepressible economic tide that would turn the world’s largest democracy into one of the 21st century’s economic powers.
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A rupee that has lost nearly a quarter of its value in 12 months, a soaring budget deficit, tanking sharemarket and savagely curtailed growth were never part of the plan. But this is India’s economic reality.

India’s economy has staggered to its worst position since the global financial crisis of 2008-09.

Inflation remains above 7 per cent, and, despite promises to cut subsidies, India’s budget deficit was 5.9 per cent in the financial year ended March, and will stay above 5 per cent this year.

The rupee is hovering at record lows, near to, and even briefly above, 56 to the US dollar, and has lost 24.8 per cent of its value since this time last year. Analysts predict it might fall as low as 58.50 in coming months if the European financial dilemma deteriorates.

India’s growth last quarter, 5.3 per cent, was the worst result in eight years. The manufacturing sector shrank 0.3 per cent in the quarter compared with a year earlier, while the farm sector grew by only 1.7 per cent.

India was once the darling of international investors, but foreign firms are now steering clear of the country. Several global telcos have quit India over corruption and uncertainty in licensing.

Gross capital formation – a measurement of fresh investments by companies – grew by 5.3 per cent last financial year, down sharply from 11.1 per cent the year before. As a proportion of GDP it has fallen below 30 per cent.

Worse numbers after bad have prompted Standard & Poor’s to cut India’s credit outlook from stable to negative, imperilling its BBB-minus investment grade status.

Finance Minister Pranab Mukherjee says India’s economic malaise is worse now than during the global financial crisis because this time the cupboard is bare.

He says the government does not have the money to repeat the huge stimulus program launched four years ago. ”The second round of global uncertainty and the slowdown has come rather quickly on the heels of the previous one, with practically no headroom for running a proactive fiscal policy.”

But, to the frustration of businesses and despair of India’s 400 million poor, finding an excuse to do nothing has become this government’s modus operandi.

Almost all of the Indian government’s major economic efforts – to allow foreign investment in multi-brand retail (supermarkets); to curb food inflation; to reform taxation and bring in a GST; or to stop the country’s rampant corruption (much of it within the government) – have failed.

A report from Standard and Poor’s this week, titled Will India be the first BRIC fallen angel? – said Prime Minister Manmohan Singh had no authority in the government. “The cabinet is appointed largely by Sonia Gandhi,” it said. ”Hence, the Prime Minister often appears to have limited ability to influence his cabinet colleagues and proceed with the liberalisation policies he favours.”

Dr Kanhaiya Singh, senior fellow at the National Council of Applied Economic Research, told BusinessDay in Delhi: “The government is in a precarious position, a position it has itself created. No one can give this government good marks. The management of inflation and interest rates, and of the economy generally, has not been good for the past few years.”

He said inaction had gripped the government, and time-sensitive decisions were deferred or abandoned because of political difficulties.

”And the major reason behind this indecisiveness is the eruption of a volcano of corruption. That has jeopardised the entire bureaucracy and the political system. No one will make a decision, everyone is too scared.”

Stung by months of criticism, the Prime Minister has committed his government to 10,000 kilometres of new roads, and 18,000 megawatts of additional power generation this financial year, as well as beginning work on 42 port projects and three new airports. ”In these difficult times, we must do everything possible to revive business and investor sentiment,” he said.

India’s unwillingness to use the good times of previous years to prepare for the bad – running up deficits even while growth was in double digits – encourage comparisons with the European economies now staring down imminent collapse. But analysts say that unlike Europe and its structural problems, India’s economic fundamentals are sound and the country can recover.

‘The fundamental ingredients of the Indian economy are intact,” said Kanhaiya Singh, from the National Council of Applied Economic Research. ”They are not jeopardised, so, once these upheavals are taken care of, and the international economic environment comes back to normal, India will quickly pick up.”

”The current problems facing the economy aren’t insurmountable,” Prashant Jain, chief investment officer at HDFC Asset Management in Mumbai told Bloomberg.

”With a few difficult steps, it should be possible to put it back on the rails fairly quickly.”

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Separating claims would cost $1bn in benefits

Aboriginal groups at odds over the James Price Point site marked for a $35 billion gas hub have withdrawn a bid to splinter native title claims after the West Australian Government and the project’s operator Woodside Petroleum threatened to suspend more than $1 billion in benefits.
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It is understood that there are long standing differences of opinion over the cultural significance of the claim site, which includes James Price Point, between the Goolarabooloo and the Jabirr Jabirr people of the Kimberley region.

The two groups have remained on the one native title claim since the 1990s, until last week where an application was filed to withdraw the claim which would have allowed two separate claims to be registered in time for the next round of land acquisition talks.

The move was understood to have seen both groups entitled to participate separately in future negotiations over the Browse liquefied natural gas hub proposal.

However, moments before going to court today, those behind the decision to splinter buckled under pressure from the WA government and Woodside to withdraw the application, leaving the conflicted groups to remain as the one negotiating body.

The hub at James Price Point is an option for processing gas from the Browse basin off the West Australian coast, but a final investment decision is not expected from Woodside until early next year.

Representing the joint claim lawyer, Vance Hughston told the Federal Court in Perth both sides had received letters from Woodside and the government shortly after the application to end the claim was lodged last week.

The groups were served with default notices in relation to the previous Browse Precinct Agreement, estimated to be worth about $1.5 billion, as well as notices to suspend their benefits under the agreement leading up to today’s hearing.

“The applicants are no longer prepared to push ahead with this discontinuance,” Mr Hughston said by videolink.

“The applicants find themselves in an impossible situation where the stakes are so high that they’re not prepared to take this matter any further without taking instructions from the broader group.”

Kimberly Land Council chief executive Nolan Hunter said the “extreme pressure from the State Government and Woodside has taken its toll on the Named Applicants,” in a statement after court.

“As a result, they instructed the KLC to withdraw the Discontinuance Application and hold an entire Goolarabooloo Jabirr Jabirr native title claim group meeting to decide whether the group should split and lodge individual native title claims, or if it should remain together as one group.

“Native title is important to the Goolarabooloo and Jabirr Jabirr people and needs to be determined to provide certainty to the group and resolve any internal issues.”

The validity of any state agreements signed by the group is expected to be challenged in the coming weeks.

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