Snowy Hydro CEO Paul Broad had dismissed suggestions of an improper conflict of interest between himself and controversial property developer Jeff McCloy, who is set to cash in on a deal to sell land to Snowy Hydro that will host a new gas fired generator in the Hunter Region.
During Senate Estimates on Tuesday, representatives of Snowy Hydro, and government officials, received a barrage of questions about the feasibility of a $600 million plan to build a new gas fired peaking generator in the Hunter Region. The proposal has been widely criticised by senior energy market players, who have suggested the proposal does not stack up or is unnecessary.
The hearing at times became combative, with senators complaining of long rambling answers being provided by Broad, and Snowy COO Roger Whitby, leading to an accusation that they were trying to ‘filibuster’ senate estimates in an attempt to limit scrutiny of the government owned generator.
The scrutiny ultimately covered the circumstances of a deal to purchase land to host the Kurri Kurri project in the Hunter region, currently owned by problematic Liberal party backer Jeff McCloy.
Jeff McCloy is a property developer, former Lord Mayor of Newcastle and long-time financial backer of the Liberal Party and its election candidates. Such was the extent of McCloy’s financial support for the Liberal Party, he described himself as a “walking ATM”, and financial gifts were at times distributed by McCloy from his Bentley.
Through his business dealings, McCloy came to be the owner of the land at the site of the former Kurri Kurri aluminium smelter – through his property development firm McCloy Group – land that is set to be sold to Snowy Hydro to become the site of a new 660MW gas fired power station.
The land purchase is set to be funded by a $600 million budget commitment by the Morrison government.
Facing questions about potential conflicts of interests between senior members of Snowy Hydro’s management, Broad told a senate estimates hearing on Tuesday afternoon that he had known McCloy since his university days and that they had known each other for the last 40 years.
However, Broad added that he had recused himself from the negotiations between Snowy Hydro and the owners of the Kurri Kurri site as a result of his prior role as chair of the Hunter Development Corporation.
“I handed all that land negotiation to [Snowy Hydro general counsel Cesilia Kim]. I think it’s important. When I was chairman of the Hunter Development Corporation prior to joining Snowy Hydro, we were in negotiations with Snowy Hydro in other land matters in the Hunter. So I’ve deliberately excluded myself from all land negotiations between Snowy Hydro, in Hunter matters, and continue to do so,” Broad said.
Broad was pressed by Labor senator Tony Sheldon on the ownership arrangements of the Kurri Kurri site, which saw McCloy become acquire ownership of the site after it had already been earmarked by Snowy Hydro for the gas plant.
Broad told the hearing that he was not aware that McCloy had become an owner of the Kurri Kurri site.
“Are you aware that two months after the board identified this property and six months before it became known to the public that Mr McCloy had purchased that property? Are you aware that that’s that sequence of events?” Sheldon queried.
“I’m not aware he’d purchased that property then, no,” Broad responded.
“Are you aware that he took a part ownership in that property?” Sheldon asked.
“I’m not aware of those details, no,” Broad said.
Officials from the Department of Industry, Science, Energy and Resources had told an earlier senate estimates hearing – prior to the formal announcement that the Morrison government would proceed with the gas plant – that they were not aware of McCloy’s activities as a Liberal party donor, nor as the owner of the Kurri Kurri site.
McCloy fell afoul of a ban on political donations on property developments and was the subject of an investigation by the NSW Independent Commission Against Corruption. McCloy had provided two unlawful $10,000 gifts to two state Liberal Party parliamentarians, Tim Owen and Andrew Cornwell. They were subsequently forced to resign from parliament due to the scandal.
