Queensland Nickel, 100% owned by mining magnate and federal politician Clive Palmer, has gone into voluntary administration.
The Townsville-based operation, hit by falling ore prices caused by a downturn in stainless steel demand, last week made 237 workers redundant.
Today Queensland Nickel managing director Clive Mensink said he believed the company had the ability to continue its operations and trade out of administration.
“From our perspective it is business as usual and employees of QNI (Queensland Nickel) will continue productivity at this difficult time,” he said.
John Park, Stefan Dopking, Kelly-Anne Trenfield and Quentin Olde of FTI Consulting were today appointed as voluntary administrators.
“No significant changes to the company’s trading operations are anticipated in the immediate term,” the administrators said. “As administrators, we will act independently at all times, although we will work with Queensland Nickel management and staff in continuing to operate the business.”
In recent weeks, Palmer’s company unsuccessfully asked the state government to be guarantor for a $30 million loan to keep the refinery going.
The price of nickel is at a decade low of about $3.75 per pound compared with $7 in 2009 when Palmer bought the operation from BHP Billiton.
Queensland Nickel says Palmer and his family provided $2.5 million of personal money so workers could be paid prior to Christmas.
Numbers released by the Electoral Commission of Queensland show Queensland Nickel donated $288,516 to the Palmer United Party (PUP) in the six months to December 31.
The company says the donation represented a cash payment as well as monetary value for goods and services in kind.
Mensink, the managing director of Queensland Nickel, says the Palmer United Party stood for the abolition of the carbon tax which threatened to cost the company $24 million a year.
“Queensland Nickel would not have been able to continue its operations with a carbon tax,” Mensink says.
“As a company we made the decision to support PUP as one of its major policies was to abolish the carbon tax,” he says. “At the time Queensland Nickel provided nearly 1000 jobs and a further 1500 positions as a result of its activities.”
Business Insider Emails & Alerts
Site highlights each day to your inbox.