Gina Rinehart knew in the 1980s some iron ore-rich mining tenements were co-owned by another company, lawyers for her father’s former business partner say.

July 25, 2023

Australia’s richest person Gina Rinehart was aware an iron ore-rich tenement from which her company has made billions was jointly owned by another company before she signed a deal with Rio Tinto to mine it, a court has been told.

The heirs of Lang Hancock’s former business partner, Peter Wright, are fighting in the West Australian Supreme Court for multibillion-dollar stakes in a series of Hope Downs assets he and Mrs Rinehart’s late father discovered in the 1950s.

Their lawyer Julie Taylor said dozens of letters penned by Mr Hancock in the decades after showed he worked on behalf of the men’s partnership agreement to secure the tenements for the areas and open them up for mining.

One written to Mrs Rinehart on February 20, 1986 discusses Mr Hancock’s attempts to divide up some of Hancock Prospecting’s assets between himself and his daughter.

It details a series of tenements, some of which Mrs Rinehart is fighting to retain, including East Angelas now known as Hope Downs Four, that were jointly held by the Hancock and Wright business partnership.

“This is very significant evidence that both Lang and also Mrs Rinehart knew and understood that all of those areas were held jointly for the partnership,” Ms Taylor said on Tuesday.

“(Hancock Prospecting) was only entitled at most to a half (share).

“Mrs Rinehart has known at least since February 1986 that the position with these assets is that they are held jointly with the partnership.”

Ms Taylor told Justice Jennifer Smith the letter came from discovery documents provided by Mrs Rinehart’s two eldest children, John Hancock and Bianca Rinehart, not Hancock Prospecting.

The pair are also involved in the complex case, claiming they are entitled to a hefty share in the Hope Downs operation as assets their grandfather left them.

The court heard Mr Hancock summoned Mr Wright’s children to a meeting soon after their father died in 1985 and told them he was managing assets on behalf of the partnership.

He told them about the men’s jointly-held tenements, including East Angelas, saying “that is Hope Downs, it’s Hancock and Wright” as he referred to a map and these are “areas that belong to us both”.

“Lang is indicating that the areas are the subject of the entitlement of both partners,” Ms Taylor said.

About two dozen lawyers have packed the Perth court for the trial since it started on Monday but neither Mrs Rinehart, her children nor Mr Wright’s surviving heirs have been spotted.

Deceased prospector Don Rhodes’ family company DFD Rhodes was also represented in court and claims a 1.25 per cent royalty share of Hope Downs’ production over a deal with Mr Hancock and Mr Wright that saw it hand over tenements in the 1960s.

The trial is expected to run until November, with any judgment potentially superseded by the looming outcome of Federal Court arbitration between Hancock Prospecting and Mrs Rinehart’s children concerning the same issues.

Mrs Rinehart inherited her father’s iron ore discovery in WA’s Pilbara region and forged a mining empire after he died in 1992.

She developed mines from the tenements Mr Hancock and Mr Wright discovered at Hope Downs, signing a deal in 2005 with Rio Tinto, which has a 50 per cent stake in the project.

Her wealth is estimated to be about $36 billion and she is executive chair of Hancock Prospecting.

The Hope Downs iron ore mining complex is made up of four open-pit mines near Newman.

It produces more than 45 million tonnes each year and is one of Australia’s largest and most successful iron ore projects.

Wright Prospecting has demanded a share of unmined and mined Hope Downs tenements and royalties.

Hancock Prospecting maintains it undertook all the work, bore the financial risk involved in the development and is the legitimate owner of the assets.