Counsel assisting the inquiry Peter Braham, SC, told the Independent Commission Against Corruption hearing in Sydney yesterday that there was a ''real delinquency on the part of the minister in the discharge of his public office'' in granting the leases to Doyles Creek Mining and Maitland, who saw his investment in Doyles Creek of $166,000 turn into $15 million.
“The state gained almost nothing for this disposition of hot property to Mr Maitland and his associates,” Braham said. “On any view, it has been a financial disaster for the people of NSW and a goldmine for the entrepreneurs.”
Braham said although Macdonald and Maitland had denied a significant association, “other evidence suggests that they were observed to be mates, and mates with a long association and shared factional allegiance within the hard Left of the Australian Labor Party’’
The deal was toasted by Macdonald and his associates at a swanky Sydney restaurant on December 24, 2008, without the knowledge of Macdonald’s department, which only found out about the minister's decision from the media.
''This was unprecedented,'' Braham said.
The inquiry – codenamed “Operation Acacia” – begins hearing evidence from the first of 60 witnesses tomorrow and is expected to run until the end of next month.
Doyles Creek was acquired in 2010 by the listed NuCoal Resources.
NuCoal’s current managing director, Glen Lewis, made $7.3 million from the deal, while director Mike Chester made $1 million. Solicitor James Stevenson, also a shareholder in Doyles Creek and a former board member, made $5.8 million.
The Newcastle-based co-founders of Doyles Creek Mining, Craig Ransley and Andrew Poole, made profits of $15 million and $18.5 million respectively.
Macdonald’s claim that he granted the licence on departmental advice was “entirely repudiated by the documentary record, renounced by the departmental officers involved and rejected by Mr Macdonald’s own staff”, Braham said.
A training mine to be attached to the Doyles Creek operation would be examined by the inquiry to determine whether it was designed as “spin or political cover for the minister’s decision”
NuCoal said: “In relation to the forthcoming hearings, the company will continue to assist ICAC as required.”
The Operation Acacia hearings will examine events and a period in time long before NuCoal had any interest in EL 7270.
In February 2010, NuCoal acquired all of the issued capital of Doyles Creek Mining after conducting rigorous and extensive due diligence, including the awarding of EL 7270 to DCM by the state government in December 2008, NuCoal said.
