gunns confident pulp mill will be built

Gunns confident pulp mill will be built

FORESTRY company Gunns says it is confident work at its northern Tasmanian pulp mill will continue, despite the possibility of state-issued permits expiring.
According to permits issued by the EPA, work on the $2.5 billion Tamar Valley mill must have "substantially commenced" by today.

A contractor to conduct earthworks at the site was only appointed last week, but Gunns managing director Greg L'Estrange said his company had satisfied the terms of all its permits.

"This has been a long process if you go through the number of issues required to go through with this project," Mr L'Estrange told ABC Radio today.

"We're making excellent progress and this is another step in that journey.

"We believe that the commitment to the project and the work done to date complies with the requirement."

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Related CoverageState makes settlement offer to Gunns

He said the company was close to finally securing a joint venture partner for the project.

"We have a process that has been longer than we all would've liked, but we're reaching the final steps of that with a competitive process to resolve exactly who will be the partners in the project," Mr L'Estrange said.

Tasmanian Premier Lara Giddings yesterday said the Sate Government had made a settlement offer of an undisclosed amount to Gunns, after the company last year forfeited its native forestry contracts, effectively halving the industry in the process.

Mr L'Estrange said Gunns was considering the offer.

"We're working through the details - it's a complex issue," he said.

"(We) hope to get a resolution relatively quickly."

Ms Giddings said the offer would include a resolution of disputed debts between Gunns and the state-owned Forestry Tasmania, with the latter claiming they are owed $25 million.

Gunns last week posted a $355 million loss for the 2010-11 financial year, saying the exit from native forestry logging had already cost the company $88 million.

Shares in the company have been in a trading halt since August 4, having last sold at 20.5 cents.

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