Queensland Nickel

In January 2016, Queensland Nickel went into voluntary administration, that is, the company was having difficulty meeting its financial obligations. The story's big news in Australia because Queensland Nickel is 100% owned by one of Australia's most colourful characters, Clive Palmer. Palmer is reputed to be worth about $1 billion and has business interests in minerals and property, including the Palmer Coolum Resort which houses animatronic dinosaurs on its golf course which has been rather controversial. Palmer has been involved in politics since the 1970s firstly as a member of the National Party, then of the Liberal-National Party, then in 2013 he formed his own political party, the Palmer United Party or PUP. And yes, Australians did actually vote PUPs into parliament, including Palmer himself who won the seat of Fairfax  (located in Queensland on the Sunshine Coast, just north of Brisbane, created in 1984 and named after the founder of the Country Women's Association, Ruth Fairfax). But enough of the Australian political history lesson, lets get back to the Queensland Nickel problem.

Nickel is an important metal in our society. More than 80% of the nickel produced worldwide goes into alloys. When alloyed with other metals, nickel imparts toughness, strength and resistance to corrosion as well as various magnetic, electrical and heat resistant properties.  About 65% of all nickel produced is consumed making stainless steel which is used to make cars as well as many other consumer and commercial products, including the kitchen sink!

The worlds largest producers of nickel are the Philippines, Indonesia, Russia, Canada and Australia.

Australia exports about $4 billion of nickel per year, making it an important export commodity. Australia has about 17 million tonnes of nickel reserves. Western Australia has about 96% of these reserves, Queensland about 3.8% and Tasmania about 0.2%. At the current rate of production, these reserves should last about 70 years.

In 1974, nickel mining began at Greenvale, 220 km northwest of Townsville. This nickel ore was transported by train to the Palmer owned refinery at Yabulu,  about 25 km north of Townsville. The Greenvale mine closed in 1992, however, commencing in 1986, nickel ore was shipped from New Caledonia, the Philippines and Indonesia to Townsville then transported by rail to the refinery. The refinery produces about 32,000 tonnes of nickel and 19,000 tonnes of cobalt per year.

The Yabulu plant carries out three process:

1. ore processing
2. mixed nickel-cobalt hydroxide processing
3. nickel and cobalt refining

Nickel ore contains nickel oxide, NiO. Ore processing involves blending, drying, and milling to fine powders.
The fine ore powder is then mixed with fuel oil reductant (C) and reduction roasted at  750°C under reducing conditions achieved by the partial combustion of fuel oil to carbon monoxide and the addition of hydrogen gas. We can represent the reduction of NiO by C as:
                750°C 
NiO + C  --->    Ni + CO

 The reduced ore, containing nickel and cobalt, is cooled and then leached in aqueous ammonium carbonate liquor at atmospheric pressure to selectively dissolve nickel and cobalt. This product liquor contains about 12 g L^-1 Ni and 0.6 g L^-1 Co, while the residual solids in the tailings contain carbonates of manganese and magnesium. The solution containing dissolved nickel and cobalt is separated from the solids and the excess ammonia removed. Patented ammoniacal extraction technology selectively extracts nickel which is then precipitated as basic nickel carbonate,  Ni₄CO₃(OH)₆(H₂O)₄

4 Ni²⁺ + CO₃²⁻ + 6 OH⁻ + 4 H₂O --->  Ni₄CO₃(OH)₆(H₂O)₄

This basic nickel carbonate is dewatered and the product can then be calcined in a rotary kiln under reducing conditions to produce nickel. Calcination drives off carbon dioxide and water to produce nickel calcine, approximately 60% nickel and 40% nickel oxide. After further reduction of nickel calcine using hydrogen, a metal is produced that is 99% nickel:
NiO + H₂  --->  Ni + H₂O
The Palmer-owned Queensland Nickel refinery is still operational, and there is no shortage of nickel ore to refine, so why is the business in danger of closing? 
According to Palmer, the financial difficulties Queensland Nickel find itself in result from a fall in nickel prices  and the Queensland Government's refusal to guarantee a $35 million loan. Certainly nickel prices have been in a general decline, In 2007, the price of nickel peaked at about $50,000 per tonne, in 2008 the price of nickel was about $20,000 per tonne, now it is worth less than half that much, probably because the supply of nickel is simply greater than demand for it. So, why is this story getting so much media attention? Is it because 237 workers at the refinery were sacked? Maybe, but the biggest issue in the media surrounds the purported donations made by the Palmer-owned Queensland Nickel to the Palmer-founded and led political party, PUP, to the tune of $15.2 million donated in 2013-14 financial year and another $5.9 million in 2014-15, which could probably have paid 237 workers for quite a few more months.

References:
http://www.abc.net.au/news/2016-01-16/qld-nickel-donated-nearly-$290k-just-2-weeks-before-sackings/7093096
http://www.smh.com.au/federal-politics/political-news/clive-palmers-political-career-on-the-brink-after-business-meltdown-20160118-gm8a0q.html
http://www.smh.com.au/business/mining-and-resources/clive-palmers-queensland-nickel-in-voluntary-administration-20160117-gm7x8r.html

Further Reading:
Metal Extraction Concepts: http://www.ausetute.com.au/metalextract.html
Carbon Reduction Method: http://www.ausetute.com.au/creduction.html
Redox Concepts: http://www.ausetute.com.au/redox.html
Oxidation States (Numbers): http://www.ausetute.com.au/oxistate.html
Percentage Composition: http://www.ausetute.com.au/percentc.html

Suggested Study Questions:

1. What is the oxidation state (oxidation number) of nickel in each of the following:
   • Ni
   • NiO
   • Ni₄CO₃(OH)₆(H₂O)₄


2. In the reaction:      NiO + C  --->   Ni + CO
   • Which species is oxidised?
   • Which species is reduced?
   • Which species is the oxidant?
   • Which species is the reductant?
   • Which species is the reducing agent?
   • Which species is the oxidising agent?
   • Is this a redox reaction? Explain your answer.
3. Nickel oxide, NiO, can also react with hydrogen gas in a similar reaction to the one above in order to produce solid nickel, Ni, and water.
   • Write a balanced chemical equation for this reaction.
   • Which species is oxidised?
   • Which species is reduced?
   • Which species is the oxidant?
   • Which species is the reductant?
   • Which species is the reducing agent?
   • Which species is the oxidising agent?
   • Is this a redox reaction? Explain your answer.
4. Nickel oxide, NiO, can also react with carbon monoxide gas in a similar reaction to the one above in order to produce solid nickel, Ni, and carbon dioxide.
   • Write a balanced chemical equation for this reaction.
   • Which species is oxidised?
   • Which species is reduced?
   • Which species is the oxidant?
   • Which species is the reductant?
   • Which species is the reducing agent?
   • Which species is the oxidising agent?
   • Is this a redox reaction? Explain your answer.
5. The carbon reduction method can also be used to extract zinc metal from zinc oxide.
   • Write a balanced chemical equation for this reaction.
   • Which species is oxidised?
   • Which species is reduced?
   • Which species is the oxidant?
   • Which species is the reductant?
   • Which species is the reducing agent?
   • Which species is the oxidising agent?
   • Is this a redox reaction? Explain your answer.
6. Name one other metal that could be extracted from its oxide using the carbon reduction method and explain why this method could be used for this metal.
7. Name a metal that cannot be extracted from its oxide using the carbon reduction method and explain why this method would not work.
8. Native nickel, that is, nickel found as the element and not in compounds, is rarely found in nature on Earth. Explain why.
9. When native nickel is found on Earth, it occurs as an alloy with iron inside large meteorites. Explain why elemental nickel can be found inside these meteorites that landed on Earth.
10. Calcination is the process of heating a compound to drive off carbon dioxide. Nickel(II) carbonate can be calcined to produce nickel(II) oxide. Write a balanced chemical equation for this reaction.
11. The most common application of  calcination is to convert calcium carbonate in limestone into calcium oxide (called lime) in the production of cement. Write a balanced chemical equation for the calcination of calcium carbonate.
12. Assume a nickel ore is composed of 2% NiO, what mass of ore must be processed annually to produce 32,000 tonnes of nickel metal?
13. In 2014 the price of nickel was an average of about $16,000 per tonne, while in 2015 its price had fallen to about $10,000 per tonne. Assuming Queensland Nickel maintained a steady production rate of 32,000 tonnes per year, what was the change in Queensland Nickel's revenue from 2014 to 2015.
14. What do you think contributed most to the financial difficulties of Queensland Nickel, falling nickel prices or millions of dollars in political donations? Justify your answer.