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Rinehart's Roy Hill mining project gets $700m loan

Billionaire Australian mining tycoon Gina Rinehart has received a cash injection for her AUD$10 billion (€6.5 billion) Roy Hill mining project from the Export-Import Bank of the United States.

Billionaire Australian mining tycoon Gina Rinehart has received a cash injection for her AUD$10 billion (€6.5 billion) Roy Hill mining project from the Export-Import Bank of the United States.

The bank – a federal agency designed to support private enterprises – authorised a $694.4 million (€451 million) loan to the mine in western Australia on the condition Roy Hill buys its equipment from US firms.

Mining and rail equipment companies Caterpillar Inc, General Electric and Atlas Copco will be the main beneficiaries. The bank said in a statement the loan would support 3,400 jobs across the US.

Fred Hochberg, chairman of the Ex-Im bank, said: "Our financing positions American companies on a level playing field so they can close the sales and expand their home-grown workforces."

Rinehart – the second-generation head ofHancock Prospecting, which owns 70% of Roy Hill – still has a little way to go to raise the funds to get the project off the ground.

The mine's shareholders have provided AUD$3 billion, while a group of investment banks will provide a further AUD$3 billion.

The Ex-Im bank's loan will go some way towards plugging the AUD$4 billion hole in the project's funding. Four other government export credit agencies, including South Korea and Japan, are also due to finalise loans to the project shortly.

Roy Hill Mine's shareholders had originally hoped to have all the financing arrangements signed-off by the end of the year, but commentators now suggest it is likely to be completed early next year.

The first ore is due to be extracted from Roy Hill in late 2015. 

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