is govt.backing off?

Mercury

Pulp mill permit confusion
NICK CLARK | May 28, 2011 12.01am


GUNNS Limited's pulp mill project could be affected by an unclear term in the building permit.

The Pulp Mill Assessment Act 2007 says the the mill permit lapses if the project is not "substantially commenced" by August 30.

A document obtained by the Mercury under the Right to Information Act shows the term "substantially commenced" has not been defined by the legislation.

Gunns has just three months to lock in a joint venture partner and financier for the $2.5 billion pulp mill.

Briefing notes for Environment Protection Authority director Warren Jones last November said: "Substantial commencement is not defined in the permit or elsewhere.

"Legal advice may need to be sought by the Government if any doubt exists about the status of the permit at the time.

"There is some risk that a third party may choose to test the expiry clause in a court of law.

"There are no inbuilt options for extending or modifying the expiry date."

After earlier permits apparently expired in August 2009 the State Government passed the Pulp Mill Assessment Amendment (Clarification) Bill in November 2009.

While it provided certainty about the August 2011 expiry date it did not, according to Mr Jones, provide certainty about the term "substantial commencement".

A spokesman for Premier Lara Giddings said yesterday that any discussion concerning the substantial commencement of the project was premature at this time.

"There are a number of regulators, including the EPA, who have responsibility for determining compliance under the pulp mill act," he said. "Interpretation of definitions would therefore be a matter for the relevant regulator."

Gunns cleared the 90ha Bell Bay pulp mill site and put in a road in late 2009, but it is not known if that would be judged as substantial commencement.

In March this year Gunns managing director Greg L'Estrange acknowledged the August deadline saying, "We have certain time constraints and we're very mindful of those."

A Gunns spokesman said yesterday the doubt was removed with the clarification bill.

It appears Gunns' view has changed since its legal representative Shaun McElwaine wrote a 10-page letter to Solicitor-General Leigh Sealy in 2009.

"Gunns Ltd does not accept that the pulp mill permit is subject to any limitation as to time," he wrote.

"As a consequence Gunns Ltd does not accept or concede that the concept of substantial commencement is relevant to the pulp mill project."

The Gunns spokesman said Mr McElwaine's letter had been superseded.

The Right to Information officer exempted significant parts of legal letters between Mr Jones and the Solicitor General Leigh Sealy.