April 9 (Bloomberg) -- Australia, examining a surge of investment proposals by China, will consider every offer by an overseas mining company for its natural resources on a case-by- case basis.

“There has always been the recognition that each proposal is different and must be tested on its merits against national interest,” Resources and Energy Minister Martin Ferguson said in speech notes for an industry briefing in Melbourne today.

Lawmakers in March began a probe into investments by state- owned companies and sovereign wealth funds after Chinese companies announced $21 billion in spending on Australian companies in a month. Australia knocked back a proposal by China Minmetals Group to take over OZ Minerals Ltd. last month on national grounds as the world’s biggest metals consumer speeds up acquisitions amid the global recession.

“Interest in Australian resources is predictably high as developing nations seek secure, long-term supply of the commodities required to build their infrastructure and modernize their societies and economies,” Ferguson said. Australia is “against a retreat to isolationism, xenophobia and protectionism,” he said

Australia approved China’s Hunan Valin Iron & Steel Group’s A$1.3 billion ($920 million) investment in Fortescue Metals Group Ltd. last month. It is considering a proposal for Aluminum Corp. of China to invest $19.5 billion in Rio Tinto Group, which has a third of its assets in Australia, and a revised offer from Minmetals for most of OZ Minerals’s assets.

Minmetals takeover bid was rejected because one of OZ Minerals mines was located near a weapons testing area.

Australian Opposition

Polls in the past week showed a majority of Australians opposed investments from China in mining companies. Some 59 percent said the Australian government shouldn’t allow state- owned Chinalco to increase its shareholding in Rio, according to a Newspoll announced April 7. A day earlier, an Essential Research poll found 57 percent of people polled said Chinese investment in mining companies should be resisted.

China may spend more than $500 billion on overseas resources investments over the next eight years to secure supplies, Eric Lilford, head of Australia mining for Deloitte Touche Tohmatsu, said March 23.

Australia’s scope to expand liquefied natural gas production is “one of the most prospective opportunities” to buffer the nation’s economy against the recesion and kick-start a new boom, Ferguson said.

Energy Investments

Woodside Petroleum Ltd.’s A$12 billion Pluto LNG project will enable Australia to maintain a global market share of 8-9 percent, leaving almost 160 trillion cubic feet of undeveloped gas resources off the northwest coast that could meet demand in Japan, China, Korea and Taiwan, he said.

Chevron Corp., Inpex Corp. and BG Group Plc are among companies proposing about A$200 billion of LNG projects in Australia, the Australian Petroleum Production & Exploration Association estimates.

The government will address how to aid the expansion of the LNG industry and boost its competitiveness against countries including Qatar, Russia and Nigeria in an Energy White Paper being drawn up by his department, Ferguson said.

To contact the reporter on this story: Rebecca Keenan in Melbourne at rkeenan5@bloomberg.net; Angela Macdonald-Smith in Sydney at amacdonaldsm@bloomberg.net

Last Updated: April 8, 2009 23:00 EDT