Light shed on demise of Palmer refinery

A STATEMENT of claim lodged in court this week by liquidators of Clive Palmer’s Queensland Nickel Pty Ltd provides some insight into the events leading to the closure of Yabulu nickel refinery in 2016.

It is relevant today because Mr Palmer is claiming the then administrators rejected his offer to pay all the bills of the administration if the administrators agreed to transfer all employees and assets to a new operator to allow the business to continue.

Queensland Nickel was placed in administration on January 18, 2016.

A report from its director Clive Mensink is said to have stated the company had no cash or assets and total liabilities of $ 226.39 million.

On February 24, the liquidators say they issued a call notice to joint venture owners QNI Resources and QNI Metals to pay expenses incurred during the administration but that Mr Mensink had responded that the joint venture did not recognise the liability.

Liquidators met Mr Palmer the following day and explained that without additional funding the business would have to be closed.

On March 7 Mr Palmer presented a document stating the joint venture representatives had resolved to remove Queensland Nickel as manager and had installed Queensland Nickel Sales Pty Ltd.

But when QNS informed them on March 10 that the joint venture owners committee was not in a position to issue offers of employment, the administrators announced they would close the business the following day on March 11.

Mr Mensink met one of the liquidators that day, offering to provide an undertaking to cover the outstanding administration costs if Queensland Nickel transferred all its cash to Queensland Nickel Sales.

The liquidators say they rejected the proposal for reasons that the joint venture had not previously complied with undertakings to meet expenses, had admitted it would be unable to trade the business and was likely to prioritise the costs of care and maintenance over meeting liabilities and that Queensland Nickel’s cash at bank would not cover liabilities.

And so the refinery was closed.