Billionaire Palmer Cuts Nickel Refinery Bonuses as Prices Fall

Mining billionaire Clive Palmer cut 2011 bonuses for workers at his nickel refinery in Queensland, who received cars and overseas holidays the previous year, because of falling prices and the rising Australian dollar.

Rewards for workers at Queensland Nickel Pty, which operates the Yabulu refinery, were “different” in 2011 in response to the “changed business conditions”, Mark Kelly, a spokesman for Queensland Nickel said by phone, citing nickel prices and the local currency.

Nickel prices last year fell 24 percent to $18.710 a metric ton, reflecting lower demand from stainless steel consumers in Europe. This compares with a 34 percent gain in prices to $24,750 a ton in 2010 when Palmer, who also owns coal and iron ore assets in Australia, rewarded workers with bonuses including 700 vacations in Fiji and 50 Mercedes Benz sedans for Queensland Nickel’s 800 employees.

Palmer bought the refinery from BHP Billiton Ltd. (BHP) in 2009. The operation produced about 30,000 tons of nickel during 2011 that is shipped to stainless steel manufacturers across Asia, including Taiwan, South Korea and Japan, Kelly said.

BHP, the world’s fourth-largest nickel producer, this month cut mining operations at its Nickel West division in Western Australia by 30 percent, citing lower prices and the strong Australian dollar.

To contact the reporter on this story: Elisabeth Behrmann in Sydney at ebehrmann1@bloomberg.net

To contact the editor responsible for this story: Rebecca Keenan at rkeenan5@bloomberg.net

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