PLANS to revive the $1.5 billion Penola Pulp Mill are dead with the company behind the mill calling in liquidators.

The company’s debts total $1.68 million.

Creditors for Protavia subsidiaries Penola Pulp Holdings and Penola Pulp Pty Ltd met in Brisbane on April 8, after Protavia managing director Graham Chappel called in liquidator McLeod & Partners to wind up the companies.

It is unlikely creditors will recoup their losses because Penola Pulp’s realisable assets are estimated to be $1250.

Former Penola Pulp chief executive Don Matthews, who resigned on February 2 this year citing the company’s inability to attract funding, is the largest preferred creditor and is owed at least $275,000.

Other employees are owed a combined $306,000, while Adelaide businessman Greg Boulton, who walked away two days after Mr Matthews, is owed at least $95,000.

Holding company Protavia, the largest unsecured creditor, is owed $476,243.

Former employees did not respond to The Advertiser’s request for an interview or had no comment yesterday.

One former director said Protavia had left a last door open should future funding be secured. But No Pulp Mill Alliance spokesman Duan Butler, whose farming property neighbours the proposed hardwood mill site, said that the project has been dead for some time.

“It was just a bad idea in the first place. On environmental grounds, there was not enough water here as it was. We declared it dead three years ago,” Mr Butler said.

IndustryEdge director and forestry analyst Robert Eastment said 50 per cent of the total cost of the pulp mill, which would have pulped bluegum hardwood, would have gone towards building a power station to feed its energy-intensive processes.

The power issue combined with prices for the lower-end commodity woodchip product, as well as rising activity at a woodchip export facility at Portland inVictoria would have made investment unattractive.

Protavia proposed a 350,000 tonne-a-year mill in late 2005, but failed to attract a cornerstone investor.

It doubled the size of the mill’s proposed output and increased development costs to $1.5 billion in 2007, with State Parliament passing the Penola Pulp Mill Authorisation Act to fast track its development without requiring a full environmental impact statement.

Protavia’s project track record is poor, with failed pulp mill projects in Ipswich, Queensland, and Heywood in Victoria as well as a failed desalination plant proposal in Gladstone, Queensland.

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Down, down down: Follow the Gunns Ltd Share Price, HERE
• Jarvis Cocker yesterday on Tasmanian Times: Gunns: The Farce continues