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Palmer sells Qld refinery

Thursday, December 22nd, 2022

 Mining and political personality Clive Palmer has announced the sale of the Yabulu nickel and cobalt refinery, in Townsville, for a reported A$2-billion to Swiss consortium Zero Carbon Investek.

While Palmer did not directly disclose the exact sales amount, he said the sale would bring enormous economic and environmental benefits to the people of North Queensland and wider Australia.

“I am happy to announce that this first-class asset has found enthusiastic and expert new owners in Zero Carbon Investek,” Palmer said.

“I look forward to the Queensland government and all relevant authorities lending their full support to the new owners. This is a big win for the people of North Queensland providing jobs and economic benefits.

Palmer in 2009 acquired the Yabulu refinery from major BHP for an undisclosed amount, however, BHP said at the time that the sale would result in a A$675-million write-down for the company.

Media reports on Thursday suggested that Palmer had acquired the project for only A$1.

Yabulu is regarded as a world class, large-scale, globally significant nickel and cobalt refinery asset. It previously represented a large part of the Gross Regional Product of the North Queensland economy, contributing A$1.37-billion a year for Townsville and 3 960 full-time equivalent jobs across Queensland, with more than half those jobs being in and around Townsville.

The refinery has been placed into a high-level of care and maintenance since 2016 and is now looking to restart. The restart plan is designed to optimise refinery operations, including realising extensive tonnages of nickel and cobalt contained in the tailings storage facility. In September this year Yabulu secured a 30-year port access agreement with the Port of Townsville.

An 18-month restart plan positions Yabulu to rapidly become amongst the Top-10 largest nickel assets in the World, with a production capacity of 53 5000 t/y of nickel and 3 700 t/y cobalt.

Zerco Carbon Investek is currently in advanced discussions with a number of globally significant strategic players who are seeking product offtake opportunities, alongside investment.

Under Zero Carbon Investek, the refinery will directly employ approximately 800 staff, upon restart of operations, and many more during the construction period.

To this end, in the longer-term, Zero Carbon Investek is hopeful that the site may unlock opportunities for new domestic industry, including battery or electric vehicle manufacturing.

The Zero Carbon Investek syndicate is headed by Dr Richard Petty, who said on Thursday that the Yabulu refinery is positioned for an exciting future.  He said Zero Carbon Investek would invest an additional $800-million in capital expenditure, post acquisition, further enhancing the facility including transitioning to net zero carbon through the replacement of coal and gas fired steam and power generation with solar, saving up to 500 000 t/y of COemissions.

“Whilst the restart of the refinery is the key strategic priority, Zero Carbon Investek is also targeting the development of a large scale, 1.5Gw solar photovoltaic (PV) plant and battery storage facility at the refinery site to create new industry opportunities and sustainable environmental benefits,” he said.

“Reducing the carbon intensity of operations through the development of solar photovoltaic is a key priority for Yabulu moving forward.

“The Yabulu large-scale solar project will be situated in the Northern Queensland Renewable Energy Zone (QREZ) and is set to become a main contributor to the Queensland government’s new Queensland Energy and Jobs Plan which has a target of 70% renewable energy by 2032 and 80% by 2035, representing an A$85-billionn investment into the energy system.

“Helping the Queensland government to achieve such targets whilst boosting the economy and providing jobs is an important part of Zero Carbon Investek’s mission,” Petty said. 

The PV plant will employ more than 50 people and will generate surplus grid scale power, which can be sold locally or interstate. The associated QBB plant will employ more than 50 people and will also allow sales in other states for domestic, industrial and grid scale power generation.

“We look forward to working with the people of North Queensland and relevant authorities to fully realise the potential of this world class asset,” Petty said.

The sale of the refinery is conditional upon typical regulatory approvals, including the Foreign Investment Review Board, and other items customary for a transaction of this nature and scale. 

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