PALMER MAY LOSE WA PORT CONTROL

Palmer may lose WA port control

Clive Palmer's Mineralogy may lose its rights to operate the large new West Australian port built to handle output from China's massive WA iron ore project, according to The Australian.

Deputy Prime Minister Anthony Albanese's department is reportedly beginning the legal process to strip Mineralogy of its right to serve as operator of the port of Cape Preston following the WA government's concerns over Mineralogy's credentials and ability to operate the port.

Tens of millions of dollars are at stake for Mineralogy, making it likely that the matter will be subject to a lengthy and potentially costly legal fight.

The port was built by Chinese firm CITIC Pacific to handle the delivery of magnetite iron ore being mined in the Pilbara.

Mr Albanese's department is facing heat over the extent to which due diligence was done to ensure Mineralogy was capable of handling control of the port.

Mr Palmer and CITIC Pacific are already locked in a legal battle in Perth over a royalties dispute.

The federal government's regional head of transport security operations, Steven Rowson, had issued Mineralogy formal approval to serve as the port's operator in January, according to The Australian, however, federal Resources Minister Gary Gray has reportedly backed the WA government's concerns.