QNI Resources and QNI Metals– the companies that own the Yabulu refining assets – last week appointed Palmer-led Queensland Nickel Sales (QNS) to operate the refinery, ousting operator Queensland Nickel and its administrators, FTI Consulting.

FTI said it had no choice but to terminate the employment of Yabulu’s remaining 550 workers on Friday and they were not offered new contracts under Queensland Nickel Sales as previously thought.

QNS yesterday said the administrators agreed to fund a number of shipments to allow the refinery to continue to operate.

Palmer’s nephew Clive Mensink, who had been managing director of collapsed parent company Queensland Nickel (QN), said it was agreed the administrators would transfer property and approvals to QNS.

“In the following days, QNS made relevant applications to the Queensland government to transfer the necessary approvals to operate the refinery once the administrators had terminated the workforce, which was scheduled by the administrators to occur on March 11, 2016,”Mensink said.

“As the approvals had been planned to be transferred, in essence, to the same refinery and port operations personnel, it was anticipated that these transfers would not take more than a few days to receive government approval.”

QNS accused the administrators of freezing the bank accounts of QN, meaning that QNS did not receive the $A10 million it was expecting.

“The administrators reversed their decision, and instead of continuing to receive ore for the business, sought to cancel orders and sell the ore to other parties,” Mensink said.

“Because of the cancellation of nickel ore orders by the administrators, there is no nickel ore projected to be delivered to the refinery.

“The result is that QNS is not in a legal position to operate the refinery or because of the above reasons, does not currently know when it will be in such a position.

“As a result, there could not be a smooth and clear transfer of staff from QN to QNS, and as the refinery was already in a shutdown mode, 550 jobs were lost from the business.”

A FTI spokesman explained the firm had no choice but to keep the $10 million cash balance.

“In terms of the $10 million bank account, we are acting independently at all times and in the best interest of the creditors,” he said.

 

“This includes retaining moneys to pay for any liabilities incurred before we were replaced as the manager of the Yabulu refinery.”

The spokesman had a markedly different version of events regarding the ore purchases too.

“We ordered ore which the operator, QNS, indicated it was not willing to accept,” he said.

 

“We’re looking to sell that ore on the open market in the interest of the creditors.”

QNS has written to the Queensland government outlining the requirements for a refinery restart, including approvals, a resolution of the situation with administrators, and the rehiring of staff and relevant training.

The company also said it needed to convince its financier that “there won’t be a continuation of attacks on refinery management and that the Queensland government is supportive of refinery operations continuing”.

“For all intents and purposes, our projected start-up date is currently estimated at or around 31 July, 2016,” Mensink said.

Palmer himself fronted the media in Brisbane yesterday with AAP reporting that he blamed a tweet last week of a gnome with its middle finger up directed at Queensland Treasurer Curtis Pitt on his seven-year-old daughter.