MEDIA RELEASE – 5th April 2008


ANZ Bank’s coming decision on pulp mill highlighted

Climbers today hung a 15 meter long banner reading “NO ANZ PULP MILL” from a light tower at the ANZ sponsored stadium at Homebush, prior to a NRL rugby game between the Dragons and the Sharks. The banner was dropped from the 30 meter high tower on the outside of the stadium with no interruption to the game.

By hanging the banner, environmental campaigners highlighted the role the ANZ bank may play in financing the deeply unpopular pulp mill, opposed by a majority of Tasmanians.

The ANZ are currently bankers for Tasmanian woodchipping giant Gunns, and are considering financing the pulp mill, projected to consume 4.5 million tonnes of wood each year. Logging needed to feed this mill would contribute at least 2% to Australia’s greenhouse gas emissions, equivalent to adding an extra 2.3 million extra cars on the road each year. Gunns own figures show that the mill will dump up to 30 billion litres of toxic effluent into Bass Strait each year.

“The ANZ bank has an opportunity to act in accordance with its environmental and social policies by refusing to finance this destructive project,” said Vica Bayley, spokesperson for the Wilderness Society.

“Governments have let down the public by failing to adequately assess the pulp mill’s impacts on the environment. The ANZ has a chance to do the right thing by the community of Tasmania by rejecting this pulp mill.”

ANZ recently took over sponsorship of the stadium at Homebush, described on the website as “Australia’s Home Ground”. According to its own website, the ANZ is the “number 1 bank for corporate responsibility on the Dow Jones Sustainability Index 2007”.

“‘ANZ Stadium’ has a positive ring to it, but ‘ANZ Pulp Mill’ will sound less appealing, especially once the mill’s polluting and forest-consuming impacts are felt.”

“Financing a pulp mill which would destroy 200,000 ha of native forest, contribute to climate change and pollute Bass Strait will seriously undermine the ANZ’s credibility in the eyes of the public,” concluded Mr Bayley.


Since 1995, the ANZ bank has provided crucial financial services to Gunns,  Australia’s largest native forest logging company.
Gunns Ltd is currently responsible for:
• destroying huge areas of Tasmania’s native forests;
• releasing huge stores of greenhouse gases, further driving climate change;
• poisoning native wildlife;
• contaminating and degrading water catchments;
• litigating against people who have participated in the campaign to protect Tasmania’s forests.

The ANZ is considering financing Gunns’ pulp mill. The majority of Australians are opposed to Gunns’ pulp mill. Polls consistently show people do not want Tasmania’s irreplaceable forests pulped, the Bass Strait used as a toxic waste dump or people’s lives and health in the Tamar Valley degraded by air pollution.

The Pulp Mill
The Wilderness Society is not opposed to pulp mills. Since Gunns’ proposal we have broadly supported three other pulp mill development proposals in Australia. The reason we have supported these developments is that they have been plantation based and chlorine free.

In fact that is exactly what Gunns’ originally promised in 2004:
“Only world’s best technology utilising a low impact Total Chlorine Free (TCF) mill will be looked at. This would be a first for Australia and would eliminate the perceived environmental risk in the bleaching process through substitution of chlorine with compounds derived from naturally occurring oxygen and hydrogen…The pulp mill will focus on processing premium plantation timber given the higher percentage of fibre and the readily available resource in close proximity to the mill .”

Unfortunately Gunns backed away from those commitments and now wants to build a
native-forest fed, chlorine bleaching pulp mill in a populated part of Tasmania.
The pulp mill will initially be 80% based on native forest . It will destroy forests in the Great Western Tiers, North-East Highlands, Ben Lomond and across other parts of Tasmania. Gunns’ woodchip exports will continue from the Hampshire and Triabunna woodchip mills . The combined appetites of these mills plus the pulp mill will double the current rate of woodchipping in Tasmania and it will increase to an annual 7 million tonnes.

Gunns have indicated in the Transport section of their IIS that their major plantation estate, located at Surrey Hills in North-west Tasmania, will not be part of the feedstock of the pulp mill but be exported. Gunns has over 80,000 hectares of their own plantations at Surrey Hills. Gunns should be pulping their own plantations instead of destroying Tasmania’s native forests.

Conservative estimated attribute the greenhouse gas emissions attributable to the native forest logging needed to feed the pulp mill to be at lease 2% of Australia’s total annual emissions. This is the equivalent to adding an extra 2.3 million extra cars on the road each year. Science is showing that protecting existing native forests is one of the quickest and cheapest ways to combat climate change.

High risk investment
The pulp mill has been widely described as a ‘bet-the-company’ venture for Gunns. Gunns’ latest figures show that the pulp mill will now cost the company around $2 billion dollars (originally the project was to cost $1.2 billion). For a company with a market capitalisation of around $1.4 billion that is already over a $1 billion dollars in debt this present a huge risk. Of course the risks from a bad investment extend beyond its impacts on Gunns and the ANZ, and go more broadly to the environment, Tasmania’s economy and the local community.

Uncertainty still remains around the financial viability and sustainability of the pulp mill. In an exclusive interview with the Mercury Newspaper in Tasmania on the 3rd of March this year John Gay, CEO and Executive Director of Gunns, revealed that “pulp mill viability figures are based on world pulp process of $US800 a tonne, despite analysts predicting long-term pulp process of just $US550/a tonne ”.

Market analysts such as CommSec, Citi and JP Morgan also share substantial concerns with the project. In February both Citi and JP Morgan downgraded their rating of Gunns, JP Morgan from overweight to neutral and Citi from hold/high risk to sell/high risk.

Tasmanian Economy
Gunns’ logging operations and the pulp mill itself have been heavily subsidised by State and Federal governments. In this sense, the long-term viability of the mill may require continued political support for such subsidies over the entire life of the mill – something which cannot be guaranteed if proposed carbon trading schemes change the economic conditions over coming decades.

The pulp mill will also cost jobs and income in other industries such as fishing, farming, tourism and vineyards. A study by the National Institute of Economic and Industry Research’s Executive Director Dr Peter Brain found the most likely impact of the mill on the Tasmanian economy over 20 years would be negative $0.3 billion, not the positive $3 billion claimed in government assessments and by Gunns.

Fast-track assessments
Unfortunately the impact of Gunns’ pulp mill on the Tasmanian economy, on other industries, on native forests and climate change were never examined. In March 2007 Gunns pulled out the independent assessment which was being carried out by the state and federally accredited Resource Planning and Development Commission (RPDC).
Subsequent fast-track assessments that were set up in haste ignored the major impacts of the project.

For instance no assessment looked at the impact of logging to feed the project on climate change despite conservative estimates showing it would increase Australia’s greenhouse gas contributions by 2%. Nor were the impacts on the Tasmanian economy or other industries examined. Instead the Tasmanian government set up an economic ‘benefits’ assessment that simply re-ran Gunns’ own claims.

The ANZ have stated that they are conducting their own independent assessment of the pulp mill. However no details of what that assessment will cover or the progress of the assessment have been made available to shareholders or the public.

Currently the ANZ website states that their “decision is dependent on Gunns Limited completing a number of steps and providing us with information to enable us to complete our ongoing assessment of the mill.”

At a time when banks, including the ANZ, are promoting their environmental and social responsibility policies, involvement with a project like Gunns Tamar Valley pulp mill could seriously undermine their credibility and damage their brand.

Logging in PNG
The ANZ area also bankers for notorious Malaysian logging company Rimbunan Hijau. This is a company that is responsible for vast areas of native forest logging across South East Asia and the Pacific. They have been linked to illegal logging operations in Papua New Guinea and are alleged to be involved in human rights abuses and corruption.

ANZ’s involvement with companies such as Gunns and Rimbunan Hijau, and the forest destruction those companies are currently responsible for, leaves the bank vulnerable to consumer backlash.


Vica Bayley MR

“Governments have let down the public by failing to adequately assess the pulp mill’s impacts on the environment. The ANZ has a chance to do the right thing by the community of Tasmania by rejecting this pulp mill.”