Report claims Queensland Nickel was used to fund other Palmer interests

PERTH (miningweekly.com) – The administrators of embattled Queensland Nickel this week released a damming report, calling for the company to be wound up and for the Australian Securities and Investment Commission (Asic) to launch an investigation into the directors of the company.

Queensland Nickel went into voluntary administration in January as the company struggled to stay afloat.

In March, the administrators announced that the majority of the 550 staff at the base metals company would be made redundant after a joint venture between QNI Resources and QNI Metals, Queensland Nickel Sales, replaced Queensland Nickel as the manager of the Yabulu refinery and associated Townsville port facilities.

Queensland Nickel Sales was the also the brainchild of mining personality Clive Palmer.

However, the administrators of Queensland Nickel this week revealed that the Yabulu refinery could have remained afloat, despite the weaker nickel prices, if Palmer had not used the company to provide funding for a number of his other interests, including A$21.5-million to the Palmer United political party.

It was estimated that about A$200-million had been syphoned from the Queensland Nickel accounts into other companies within Palmer’s business portfolio.

It was revealed that Queensland Nickel also forgave A$189-million in loans between 2012 and 2016.

At the time of the administrators appointment, Queensland Nickel had A$1.16-million available in its Australian bank account and a further $64 000 in its US account, which the administrators pointed out, limited its options in dealing with the claims of 237 former personnel who were made redundant before the administrators were appointed.

The total redundancy entitlements for these 237 employees total A$16.2-million.

A further A$55.6-million in entitlements was owing to the 550 staff made redundant by the administrators after their appointment.

The administrators said this week that its investigations indicated that a “number of offences” were committed by the directors of Queensland Nickel, and that company management could be guilty of negligence, breach of duty or trust, and as such a report to Asic would be submitted.

Furthermore, the administrators had recommended that Queensland Nickel be wound up.