Evan Rolley – Tasmania’s forest chameleon [Part 2]

Evan Rolley: [i] “Our [Ta Ann Tasmania] volume will reduce from 265,000 cubic metres per annum to around 160,000 cubic meters – almost a 40% reduction. … We’ve got no future unless we can develop those markets; receive [FSC] certification and operate in that environment as a company going forward in Tasmania. ” [/i] [Reference: ABC Statewide Mornings, Tuesday 27 November 2012]

Executive director, Evan Rolley says the company has been guaranteed compensation for the shortfall in its contracts. The State Opposition estimates it will cost taxpayers $50 million in compensation for Ta Ann. [Reference: ABC News Radio Wednesday 28 Nov 2012 – [b]Govt tight-lipped on Ta Ann compo[/b]

Leon Compton: [i]Your gonna make tens of millions of dollars out of this [Agreement]. You’re going to be bought out for 15 years of forward contracts for more than one third of the wood supply that you were planning to use. That the basic state of play of where things are at isn’t? [/i]

Evan Rolley: [i]Well nothing with be provided to this company, as I say beyond an equivalent treatment to the sawmills [$15 million for retiring 28,000 cub metres of sawlog]. The saw mills also have long-term contracts with Forestry Tasmania and with the Government … (interrupted) [/i]

Leon Compton: [i]You signed… you signed yours [Ta Ann’s long term wood supply] Evan Rolley, while this deal was being negotiated; that was pretty smart wasn’t it? [/i]

Evan Rolley: [i]No, we signed the… wood supply agreement for Ta Ann over 5 years ago well before… (interrupted) [/i]

Leon Compton: [i]Forestry Tasmania didn’t extend you contracts during the course of this agreement [i.e. Bartlett-McKim initiated forest roundtable talks commenced in May 2010]?[/i]

Evan Rolley: [i]No, no. …. No, our base [wood supply] agreement was in fact the formula period and the term was the basis on which Forestry Tasmania extended all of the other saw milling contracts to match the Ta Ann contract. The contract with Ta Ann was the basis upon which two state-of-the-art mills were invested in over 5 years ago. Our [wood supply] contracts were signed over 5 years ago.

We signed the agreements; or the company signed the agreements on the basis of the Regional Forest Agreement [RFA] which was to provide certainty for 20 years. And within that timeframe Ta Ann’s contracts were signed. [b]So this has not been a play by Ta Ann to try and optimise some sort of payment from the public purse. What we’ve sought to do is to support the whole of this peace process on a ‘no commercial disadvantage test’ basis.[/b] We’ve received an assurance that we will not be treated any differently to the saw milling industry and the saw mills; who’ll be adjusted and changed as a result of this agreement. And that’s all that we’ve been seeking in terms of our conversation with Government. [/i]

Leon Compton: [i]What is the number then, when you multiply the years of undelivered contract by the volume of undelivered contract [i.e. 15 years for 100,000 cubic meters p.a. surrendered]. What is the number that you come up with?[/i]

Evan Rolley: [i] Well, the only number that we have at the moment is the number that we have received from Forestry Tasmania yesterday [Monday 26 November] which shows that on our current contract which runs for 15 years at 265,000 cubic metres that will be reduced to – if the Legislative Council passes the legislation – to about 160,000 cubic metres of the same category of log. So the reduction will be the 100,000 tonnes.

Now all we’ve been saying and seeking assurance from Governments is, as the saw mills will be, ahh… reduced in their volume terms, please treat Ta Ann in the same equitable manner. We have not finalised any commercial, ahhm… discussions with Government.[/i] [Reference: ABC News 28 November 2012]

Evan Rolley: [i] This company invested $84 million in two new state-of-the-art plants in 2006 based on wood supply agreements.

Our clear understanding is those contracts will be honoured and if not renegotiated. And we’ll be treated fairly in terms of any compensation in the same way as any hardwood sawmillers.[/i] [Reference: ABC News 28 November 2012]

Evan Rolley: [i]There’s always a price for changing the rules of the game.[/i] [Reference: ABC News Radio Wednesday 28 November 2012]