Cabinet ministers, led by Industry Minister Steingrimur Sigfusson, said they were unable to make a final decision on Huang Nubo's application as much information remained unavailable, state radio RUV reported.

His plans have been highly controversial, with some commentators saying they raise questions about regional security because of Iceland's strategic location in the Arctic where several nations are competing for resources.

Huang has already agreed with municipalities in the area to lease 70 percent of a 300-square-km farm, where he plans to build a golf course, hotel and outdoor recreation area.

State radio said Huang's Iceland-registered firm Zhongkun Grimsstadir had in mid-November asked for more time to supply further information, and that it could take a few more months.

In a letter to architect Halldor Johannsson, Huang's Icelandic representative, the government said Huang should submit a new application which would be reviewed by a government committee.

Huang, who is chairman of Beijing-based Zhongkun Investment Group and was 161st on the Forbes list of the richest Chinese in 2010, plans to reapply as soon as he has gathered the information needed, RUV reported.

Iceland is recovering from its worst-ever financial crisis after the complete collapse of its top banks in 2008, and it is keen to lure foreign investment.

RUV says there would be investment of about 20 billion Iceland krona in the project and that 400-600 jobs could be created.

The government's decision was seen by observers as a sign the cabinet wanted to postpone the matter until after planned parliamentary elections in May next year. (Reporting by Omar Valdimarsson; Writing by Mia Shanley; Editing by Andrew Roche)

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