Just days before Queensland Nickel went into voluntary administration, Clive Palmer made a last-ditch attempt to put himself at the front of the queue of creditors to the company.

On January 13 this year Palmer registered a priority deed over the assets of the company in the name of two of his other businesses, Waratah Coal and China First, registering an interest “over all the present and after acquired property of each of the QN, QNI Resources and QNI Metals”. The priority deed meant Waratah Coal and China First (i.e. Palmer) would be at the head of the queue should Queensland Nickel go into administration — which, lo and behold, it did, four days later.

Queensland Nickel plunged into voluntary administration on January 17, calling in FTI Consulting to manage the company’s operations. This week FTI Consulting slammed Palmer in its report recommending the company be liquidated. The report says it is possible Palmer acted as a shadow director at Queensland Nickel “at all material times” from February 2012 until the company fell into administration. Palmer claims he acted in his role as part of the joint venture agreement and his role as a member for the joint venture operating committee.

Palmer is listed as the contact for Waratah Coal Pty Ltd and China First Pty Ltd, using the pilbera@yahoo.com email address that has previously been used with the alias Terry Smith, in a security interest registered on the Personal Property Securities Register. The document says the two companies have a registered security interest over commercial property. Elsewhere in the report, the China First and Waratah Coal securities are valued at $235 million — i.e. Queensland Nickel owes them that amount of money. But bad luck for Palmer — the report says Waratah Coal and China First’s demands to be first to be repaid are invalid:

“Both Waratah Coal and China First have lodged proofs of debt (as secured creditors) under the above security arrangements. The Administrators have considered these claims and obtained legal advice. The Administrators are of the opinion the claims lodged by Waratah Coal and China First are invalid for the purposes of voting at the Second Meeting of Creditors.”

“The claim by Waratah Coal relates to an agreement between Waratah Coal and QN to make Waratah Coal assets available to QN as security in the event it sought to obtain finance and/or secure an arrangement with key suppliers. No such security has been utilised by QN and therefore no liability exists between QN and Waratah Coal.”

According to the administrators’ report, China First claims Queensland Nickel owes it $135 million in future payments in the form of a subscription for 2 billion shares in China First, which was payable in two instalments of $67.5 million due to be paid by the end of 2017 and the end of 2018. The Waratah Coal claim is for $100 million. The report says:

“Waratah Coal proposed to offer its coal tenements as security to assist Queensland Nickel in obtaining funding for general trading requirements.”

Waratah Coal was one of the entities that received cash from Queensland Nickel on November 29, 2012, when Palmer instructed transactions totalling almost $43 million. Clive Mensink, Palmer’s nephew and the sole director of Queensland Nickel, was listed as a director of Waratah Coal until January. Palmer was a director of Waratah Coal until July 2014.

The report found “significant transactions in value and in quantum entered into by QN that appear to be both director-related and uncommercial in nature”. From 2011, approximately $224.3 million of Queensland Nickel’s funds were transferred to director-related parties, including $26 million in donations to political parties and sponsorship fees. Queensland Nickel also footed the $6 million bill for Palmer’s bid to build the Titanic II, his $5 million vintage car collection, $250,000 for a Cessna plane and $40 million on golf courses.

Unsecured creditors can at best expect to receive 52.31 cents in the dollar after liquidation of the company. Queensland Nickel staff, who are owed more than $70 million in entitlements, are priority creditors.