Gunns to quit without green pact. Finnish giant may back mill

TIMBER giant Gunns will sell all of its Tasmanian native forest operations if there is no forest “peace deal” agreed between the logging industry and conservationists.

Managing director Greg L’Estrange told The Australian that, contrary to media reports, Gunns would not continue native forest operations if negotiations to restructure the industry failed.

Instead, he said Gunns would sell its entire native forest operations — harvesting, woodchipping and sawmilling — and focus on plantations and the proposed Tamar Valley pulp mill.

This would mean that old growth and high conservation value forest logging would continue — but by others, not by Gunns.

…

Under the interim “principles” agreement between the industry and environmental NGOs, harvesting of natural forests would be phased out in favour of an industry based on plantations.

If a lasting agreement can be reached, companies including Gunns would be compensated for abandoning some logging rights and be assisted to retool operations towards plantation timber.

Gunns, however, is already closing some mills regardless of the outcome of the talks, which are being brokered by the former ACTU secretary Bill Kelty.

Since institutional shareholders last year forced the departure of former chairman John Gay, the company — long at war with conservationists — has signalled a shift out of native forests.

…

Yesterday, The Australian revealed that Finland-based pulp and paper company UPM had been considering becoming a joint venture partner with Gunns to develop the $2.3 billion Tamar mill*.

Mr L’Estrange would not rule out asking the state or federal government to effectively act as guarantor to underwrite the project, if this was needed to clinch project finance and a joint venture.

“We are not ruling anything in or out as we work through this process to bring this project to fruition,” he said.

Local anti-mill group, Tasmanians Against a Pulp Mill, yesterday predicted no government would be willing to take on that level of risk, although the state government had not ruled it out.

A joint venture deal is unlikely to be finalised before a vital federal government decision on final approvals for the mill to operate, due on March 4.

The company earlier this week advised the stock exchange that Deutsche Bank had become a substantial shareholder.

Gunns is expected to announce mid-year financial results tomorrow.

Read Matthew Denholm’s full article in The Australian, HERE

*Finnish firm UPM eyes stake in Gunns pulp mill

A POTENTIAL backer has emerged to resurrect the Gunns pulp mill, with Finnish pulp giant UPM revealing it has been investigating a joint venture in the project.

UPM, which has production plants in 15 countries, confirmed to The Australian it was “studying” the $2.3 billion Gunns project as a potential investment opportunity, but insisted no commitment had been made.

There is speculation in political circles that UPM will be the joint venture partner and that Gunns is redoubling efforts to obtain a “social licence” from the local community to clinch the deal.

Gunns has in recent months tried to engage mill opponents in dialogue, promised design changes, sought to finalise federal approvals and continued to pursue Forest Stewardship Council certification.

Helsinki-based UPM, which has pulp, paper, energy and engineering businesses throughout the world, confirmed it had been considering the Gunns project.

“UPM is studying opportunities and getting to know local circumstances in different parts of the world on a regular basis,” a UPM company spokesman said.

“We have also studied the Gunns project. However, UPM is not committed to any specific plans in Tasmania.”

Gunns chief executive Greg L’Estrange would not comment on UPM’s involvement, citing confidentiality arrangements.

But he said he was confident the project was, after six years of development, controversy and setbacks, close to …

Read the rest in The Australian, HERE

Earlier on Tasmanian Times: Section 11 Again, and Again … FSC report. March Mill start?: L’Estrange

Meanwhile,
More logging roads pushed in High Conservation Value forests.

Conservationists have today walked in to forests, where a new road is being built to access threatened forests in the West Wellington Area, in Southern Tasmania.

“Threatened forest that is due to be placed in a moratorium in just five weeks in the West Wellington Area is currently being opened up for logging by Forestry Tasmania. In the past week logging has commenced in building a new road to access a 40 hectare forest area that Forestry Tasmania has stated will be logged in the coming weeks,” Huon Valley Environment Centre’s Jenny Weber said.

“Ten conservationists have participated in today’s protest to highlight the ongoing push to open up new areas of High Conservation Value forests in Tasmania. This business as usual attitude by Forestry Tasmania is despite the hypothetical progression toward a full moratorium on all high conservation value forests across the state of Tasmania,” Jenny Weber said.

“The moratorium that is due for March 15th 2011, on all high conservation value forests, not 39 areas of forest that is being interpreted by Forestry Tasmania. Why is the State Government allowing for these threatened forests to be opened up for logging when their values should be protected in full legislated protection,” Jenny Weber said.

Jenny Cambers-Smith, West Wellington Protection Group

10 February 2011 Media Release

Forestry Tasmania breaches the Moratorium on logging in High Conservation Value Forest

Before Christmas, the Federal Government announced the appointment of Bill Kelty as facilitator for forestry negotiations in Tasmania. At the same time a progressive moratorium on logging in high conservation value native forest was agreed, such that by mid-March 2011 there should be no harvesting in the areas carefully reviewed by ENGOs and defined as HCV forest.

However, it is becoming clear that Forestry Tasmania is not respecting this agreement. During the three months leading to full moratorium implementation no new coupes should be opened up in HCV areas. Yet the WWPG was told by Forestry Tasmania last week that it intends moving back into West Wellington – the mountainous area adjoining Wellington Park’s west and south-western boundaries – within a fortnight. Roading operations are already underway.

West Wellington is the continuation of the Wellington Range and provides a habitat and wildlife link between Wellington Park and the forests and wilderness of the west and south Tasmania. The whole area has been designated as HCV by ENGOs and a comprehensive report detailing its value to local communities and to endangered species, has been developed. Not only is it home to Tasmanian Devils, Wedge-Tailed Eagles and other rare native animals, it is also the water catchment for local communities and comprises the watershed between the Huon and Derwent valleys.

Jenny Cambers-Smith, involved in the WWPG from its inception, said: “given the huge effort that has gone into reaching agreement on the statement of principles and the ongoing work currently being undertaken to reach a negotiated settlement on the future of forestry in Tasmania; I can’t see people sitting idly by while Forestry Tasmania continues to act as if it is business as usual”.

She continued: “West Wellington has real value for local people and we see it developing as a great eco and adventure tourism destination in the future. The WWPG is developing a proposal for bush-walks from Hobart to Judbury and beyond and we are in discussions with the Greater Hobart Mountain Bike Masterplan to develop trails in the area. This will open up long term economic opportunities for local communities”.

The West Wellington Protection Group believes that Forestry Tasmania is trying to destabilize ongoing negotiations and calls for the company to respect the moratorium agreement. All Tasmanians want to see an end to the forestry dispute –it is in Forestry Tasmania’s interest to work with the negotiatiors, not against them.

Lucy Landon-Lane for Pulp the Mill

It has recently been released that there is a Finnish firm called UPM looking at supporting the pulp mill.

UPM are one of the largest and most experienced pulp and paper companies in the world.

http://www.theaustralian.com.au/national-affairs/finnish-firm-upm-eyes-stake-in-gunns-pulp-mill/story-fn59niix-1226002436346 (9th Feb)

http://www.theaustralian.com.au/business/industry-sectors/gunns-to-quit-without-green-pact/story-e6frg95o-1226003252502
(10th Feb)

This is what UPM say about themselves:

“UPM has three modern and eco-efficient pulp mills in Finland and a state-of-the-art pulp mill and plantation operations in Uruguay. The products range from northern softwood pulp and northern hardwood pulp to eucalyptus pulp made from fast growing plantation wood. The wood used is controlled and from sustainable sources. The total capacity is 3.2 million tons of high quality pulp.

UPM aims to be one of the leaders in the pulp market. In order to optimize the pulp flows, UPM operates both as a pulp buyer and as a pulp seller. We want to be a reliable long-term partner for our customers and our suppliers. Botnia’s sales network acts as the worldwide sales agent for UPM’s pulp.

To further increase the share of cost competitive market pulp, UPM is to carry out a feasibility study together with the Russian Sveza on building an industrial complex including a pulp mill in Russia. The final investment decision is subject to satisfactory outcome of the feasibility study and the necessary approvals from authorities.

As the Biofore Company, UPM is leading the way into a new, innovation-driven and sustainable bio-economy. We are strongly committed to continuous improvement in economic, social and environmental performance.

UPM is a signatory of the UN Global Compact, a policy platform and framework for companies that are committed to sustainability and responsible business practices.

Corporate responsibility is an integral part of our corporate strategy. We have defined key areas of corporate responsibility and principles to support the company’s strategy. The corporate responsibility principles demonstrate UPM’s focus and set the direction forward for sustainable development. Corporate responsibility is about today’s decisions while always aiming for a long term sustainable future based on profitability and value creation from sustainable products.”

We all need to make it quite clear that there will never be a social licence for this pulp mill, that our passion for Tasmania is strong and our commitment to stop this mill is irrepressible!

Please take the time to send an email to UPM: media@upm.com; ir@upm.com (investors); environment@upm.com; cr@upm.com (corporate responsibility).

You might like to point out that we will never allow this mill to go ahead because:

1. Gunns withdrew from an independent assessment process which had deemed the mill to be critically non-compliant in areas of environmental, social and economic risk analysis; these risks have never been properly assessed.
2. The fast track creation of the Pulp Mill Assessment Act includes section 11 which denies anyone who is adversely affected by the mill access to legal redress;
3. The Tamar Valley is home to 100,000+ people, most of whom do not want this mill; and there is a thriving tourist industry, wineries, organic horticulture etc. that will be seriously harmed by this pulp mill;
4. Every day 64,000 tonnes of toxic effluent (equivalent to between 1 and 2 Olympic swimming pools every hour) will be dumped into the pristine waters of Bass Strait, where there is commercial and recreational fishing, seal colonies, bottle nose dolphins (both of which are fully protected).
5. The safety of our roads will be seriously compromised by a huge increase in log trucks as well as the outpouring of 1.1 million tonnes of steam every year into an area which already gets heavy fogs for most of the winter months.

There are many news articles on the Pulp Mill at the moment, many of these allow for comments. The more that potential JVP’s see our unrest via media comments the better. Some of the most recent articles are.
http://www.themercury.com.au/article/2011/02/10/206051_opinion.html
http://www.themercury.com.au/article/2011/02/09/205631_tasmania-news.html
http://www.examiner.com.au/news/local/news/business/deadline-looms-for-final-pulp-mill-study/2070448.aspx