On February 26, Forestry Tasmania, the state-government-run corporation that manages Tasmania's forests, revealed that it had signed a 20-year deal to supply wood to Gunns Limited's proposed Tamar Valley pulp mill.
Forestry Tasmania executive general manager Hans Drielsma told the Hobart Mercury that the deal, worth about $350 million, involved half of Forestry's annual pulp wood harvest. The contract is conditional on mill construction starting by June 30.
It has also been revealed that Labor Premier Paul Lennon is considering funding the $60 million water and effluent pipelines needed for the mill to operate. The premier is considering declaring the pipelines "essential state infrastructure".
Many landowners who have refused offers of financial compensation from Gunns in return for allowing the pipeline to pass under their properties are suspicious that this latest proposal may allow the government to trigger compulsory land acquisitions for the project.
Property prices in the Tamar Valley are tumbling. Bob McMahon of Tasmanians Against the Pulp Mill told the March 4 Mercury that "West Tamar property is bust. Everyone has probably lost at least $100,000 on the value of their homes and people are leaving the area."
Hydro Tasmania has struck a deal with Gunns that will mean the pulp mill's annual requirement of 26,000 megalitres of water will cost the logging company only $624,000. The March 6 Mercury reported that the state government could have made $1.05 million if this water was used to generate power to sell to Victoria at the average 2007 rate. There is also concern that during drier the mill may use up to half the water flowing naturally into Trevallyn Dam, depriving Launceston and the Cataract Gorge of their required flows.
ANZ, a potential major financier of the pulp mill project, is engaged in environmental risk assessments of the mill. Gunns CEO John Gay told the March 1 Mercury that the bank will approve the funding. Tasmanians Against the Pulp Mill have called a protest on April 7 outside the Launceston branch of the ANZ to highlight community opposition to the mill.
In Hobart, students are planning to walk out of school on April 1 as part of a national day of action on climate change. They intend to take their protest to the ANZ bank to point out the climate change implications of the mill.
Hundreds of people rallied on March 14 outside the headquarters of Gunns in Launceston to protest the mill and mark the one-year anniversary of Gunns' withdrawal from the Resource Planning and Development Commission (RPDC), the independent body meant to assess the impact of the proposed mill.