SYDNEY, March 12 (Reuters) - A rescue plan for a nickel refinery owned by Australian mining magnate Clive Palmer has stalled, after ore shipments to the plant were diverted and government regulators raised concern that the plant lacked adequate resources to operate properly.
The Yabulu refinery, one of Australia's biggest such refineries, now has no ore left to process, according to its former administrators, who managed the plant until last week.
Clive Palmer and his spokesman, Andrew Crook, did not return phone calls from Reuters.
The plant, at Townsville in Australia's northeast, went into voluntary administration in January as a collapse in nickel prices CMNI3 to 12-year lows pushed it into financial difficulty. announced an 11-day shut down due to low ore stockpiles on Feb. 29. however, wrested back management control of the plant earlier this week as the head of a new joint-venture, Queensland Nickel Sales Pty Ltd and announced his intention to keep the refinery open. on Friday, three ships carrying nickel ore from New Caledonia and the Philippines to the refinery were diverted away from Townsville port, after Palmer's new entity declined an offer to purchase their cargo.
A spokesman for the previous administrators, FTI Consulting, told Reuters by phone that the ore had been ordered and paid for when FTI was managing the refinery and that it would now be sold, via a broker, to a third party. It leaves the refinery without any ore to process, the spokesman said.
Administrators had been strongly considering placing the Yabulu Refinery on care and maintenance due to ongoing trading losses and their concerns over plant maintenance, safety and environmental issues.
The refinery's new management, which was granted an fast-tracked environmental approval by the Queensland state government on Friday, has also now been ordered by the state's environment department to ensure environmental protection systems keep operating.
Queensland's environment minister, Steven Miles, said that his department issued the enforcement orders because QNS failed to demonstrate that it had adequate resources to comply with the initial environmental approval, issued just hours earlier.
The new orders require QNS to continue maintenance of its tailings dam and to "prevent harm to the environment," the minister's statement said.
The refinery is close to Halifax Bay, which is part of the Great Barrier Reef Marine Park and World Heritage Area.
"There are serious consequences, including the possibility of criminal charges being laid, for failing to comply with these directives," Miles said.
"Further enforcement action will be considered as necessary as events unfold."