Clive Palmer’s nickel plant to shut for months

Workers sacked from Clive Palmer’s nickel refinery have no chance of being rehired this financial year, if at all.

Clive Palmer speaking at a press conference about Queensland nickel. Pics Tara Croser.

Workers sacked from Clive Palmer’s nickel refinery have no chance of being rehired this financial year — if at all — after the MP admitted he could not reopen the plant until at least July 31.

Adding to the uncertainty, the architects of a proposed community buyback of the refinery are relying on securing hundreds of millions of dollars in government and private loans — including from a federal fund that has not yet been legislated.

Taxpayers are certain to pick up the $60 million bill for redundancy entitlements for about 787 workers sacked from the Yabulu plant, near Townsville, as the cost of rehabilitating the site was put at between $50m and $600m should the plant shut permanently.

Yesterday, almost 300 former workers attended an emotional meeting in Townsville hosted by Sister City Partners, a non-profit firm proposing to buy the refinery from Mr Palmer and install former staff, creditors and suppliers as shareholders.

The ex-workers were furious at Mr Palmer, desperate to receive their entitlements and find new jobs, and wary but hopeful about the SCP proposal.

The plan is led by investment banker and former Labor staffer Warwick Powell, who left the party after being named in the 2001 Shepherdson inquiry into vote rorting, and property investor Mark Dunworth.

The scheme must overcome significant hurdles. First, Mr Palmer must agree to sell the refinery to SCP. The Fairfax MP said he had an “open mind” after meeting Mr Dunworth on Friday.

“Running a refinery like this requires a lot of money and I don’t know whether people understand that; not just a lot of money to buy it, but you know, six or seven hundred million dollars a year in turnover,” he said.

Mr Palmer dodged suggestions he had let down workers and blamed voluntary administrators FTI Consulting, the weak nickel price and the state and federal governments for the delay in reopening the refinery. The revised restart date means workers’ entitlements would not be paid by his companies, but by the federal government safety-net scheme.

If SCP convinces Mr Palmer to sell the business, it then must secure hundreds of millions of dollars in funding, which it says will come from state and federal taxpayers and private financiers.

But the source of federal funding, the $5 billion North Australia Infrastructure Facility, will not be operating until at least July 1. It is also unclear whether the SCP proposal would be eligible for concessional loans, which are intended to finance public infrastructure such as airports, ports, roads, rail, energy and communications projects.

The Townsville meeting was told the nickel price was forecast to stay flat until at least 2020, and the plant would need $220m in capital expenditure in the first four years.

Mr Powell told The Australian his involvement with the Shep­herdson inquiry was “ancient history” and would not affect negotiations with governments.

Neither the state nor federal government would say whether they would consider lending to the SCP proposal. The federal MP for Herbert, Ewen Jones, said he would tell Malcolm Turnbull and Scott Morrison of the plan. State Treasurer Curtis Pitt was briefed on Friday by SCP representatives.

A New Caledonian ship carrying $1m worth of nickel ore is expected to moor off the Townsville coast today.

The ore was bought by FTI Consulting on behalf of Queensland Nickel Pty Ltd, the refinery’s former manager now under ­administration. It will now be sold elsewhere after Queensland Nickel Sales, the new refinery manager, refused to buy it.