TASMANIA'S PULP MILL    

A critical step to achieving financial close for the approved Bell Bay Pulp Mill has been announced by the Board of Gunns Limited.

The announcement details the proposed creation of a new corporate group, to be known as Southern Star Corporation (“Southern Star”) and states that an Information Memorandum has been released to a number of pre-qualified international parties that marks the formal process where investors have the opportunity to partner Gunns in the highly integrated pulp manufacturing and plantation forest management company.

Mr John Gay, as Chairman of Southern Star, announced the appointment of Mr Timo Piilonen to the role of Project Director. Mr Piilonen has extensive experience in the construction and operation of large-scale pulp mills around the world. Between 2004 and 2008 he was responsible for the construction and operation of Metsa-Botnia’s Fray Bentos pulp mill in Uruguay, a mill of similar size and technology to the Bell Bay Mill.

The World Bank who backed that modern kraft mill has recently published an environmental monitoring report for UPM's (formerly owned and operated by Botnia) Orion pulp mill in Uruguay covering the second full calendar year (2009) of the mill’s operation.

This independent report (7 MB) confirms that dioxins and furans are not associated with modern mills such as the Orion mill. The most toxic congeners 2,3,7,8-TCDD and 2,3,7,8-TCDF were below the 1 pg/L (as I-TEQ) level based on six separate analyses. These results are will within the Commonwealth permit conditions of 3.4 pg TEQ/L set for the Tasmanian mill.

A January 2010 opposition newsletter is wrong on pulp mill and repeats claims that were fully investigated and dealt with in 2007 before the Pulp mill was approved by the Tasmanian and Australian governments.

The newsletter, that appears to be nothing more than propaganda designed to whip up fear and opposition on the elemental chlorine free bleached kraft mill, makes claims on water use, odour at a mill in Tumut, NSW, and industrial fog in a mill in southern USA.

The newsletter and opponents have continually claimed that plantations that will supply the pulpwood will cause a dramatic decrease in fresh water availability. The latest CSIRO modelling on sustainable yield shows only an insignificant 0.3% decrease by 2030 due to future development.

The news letter tells of a white out multi vehicle accident in 1990 on a US highway built over the waste water treatment ponds of an existing newsprint mill, but only tells part of the story. Factual details of the Tennessee incident that show such an incident is extremely unlikely at Bell Bay are included in a report on the Hiwassee Valley.

The newsletter also tells of odour problems at the Tumut Mill, but fails to state that a former assessment panel member and vocal critic of the Tamar mill, ‘fixed’ the problem at Tumut to such a degree that when the mill sought to expand only one submission raised odour as a problem. A history of the Tumut mill shows that there is not an adverse impact, but that local businesses benefit from the mill.

The issue of this flawed newsletter only three months before a State election appears to be more about politics than working with the developer to provide accurate and balanced information to the local community.

Tasmania’s approved elemental chlorine free pulp mill fits the blueprint for innovation developed by the Australian Innovation Research Centre.This new vision for economic development for the State recognised that forestry and forest products remain a strength.

“ ...Tasmania’s share of Australian employment and production in forests and primary forest products and its share of employment and production in higher-value-added products indicates the potential of this sector to expand its value contribution in Tasmania.

In addition, since the vast majority of Tasmania’s production forests are now regrowth or plantations, and timber is an inherently renewable resource, the industry should be viewed as sustainable, and socially and environmentally desirable.

These factors combine to suggest the industry has considerable potential for more-profitable and innovative uses, if community divisions over environmental concerns can be overcome or transcended.”

An extract of this report related to forestry can be downloaded.

The pulp mill to be built in the Bell Bay Industrial estate incorporates the latest innovation in bleaching and in water use and recycling as well as generating renewable power from the waste product of the pulping process. Details of these innovations can be found in the design report lodged with the Environment protection Agency.

Detailed Design Report

As part of its approved permit conditions the developer Gunns Ltd has released its draft Pulp Mill Design Report (517 pp). This report has been submitted to the Director, EPA for consideration. This document is freely available for all members of the community (including Greenpeace) to view on Gunns’ website.

The draft Pulp Mill Design Report is the culmination of the extensive work undertaken in the last 2 years by Gunns and its specialist consultants to meet the requirements of the Tasmanian Pulp Mill Permit.

The report contains a detailed outline of the technology to be applied in the pulp making process. It confirms the mill to be built in a heavy industrial zone about 40kms from Launceston will use ‘Accepted Modern Technology’ and ‘Best Available Techniques’ to have a neutral impact on the environment.

Gunns Chairman John Gay told the company’s Annual General Meeting in Launceston that the recent improvement in financial markets had provided an opportunity to progress the final stage of the Bell Bay Pulp Mill project.

“The company is continuing to work positively with its banking group to close the project finance facilities,” he said.  “The company is also in dialogue with a number of parties regarding equity investment in the project.

“Gunns expects the external equity investment in the project to be approximately 40 per cent of the mill equity requirement.”

Mr Gay said the Bell Bay Pulp Mill would take advantage of Gunns’ growing plantation timber resource. “Gunns has a long-term aim to transform the company from a native woodchip business to a plantation-based company,” he said. Read the full statement.

Despite campaigning to stop global warming, the Wilderness Society is still opposing the pulp mill despite it saving over one million tonnes of greenhouse gas a year in reduced shipping and the production of renewable power.

The mill will only use pulp wood from sustainably managed plantations and regrowth native forests. Sustainable forest management has been identified as a major mitigation factor by the Intergovernmental Panel on Climate Change.

Despite this the Wilderness Society has been involved in funding the Wild country hub at the Australian National University that recently published a paper on carbon in large trees that received media attention. A member of Australia’s Institute of Foresters has written a critque of the paper that exposes possible compromises to academic conventions.

The Tasmanian Supreme Court has dismissed an application from lobby group, Environmental Tasmania, a resident and a failed green political party candidate seeking to undermine the State permit for the approved mill.

The legal challenge has featured as part of an international campaign to create uncertainty about the mill, but now in a decision handed down on 17 July 09, the Tasmanian Supreme court has a given the mill construction another green light.

The application bordered on vexatious and frivolous as it sought the reasons behind the issue of the permit, this after all 35 members of Parliament had debated at length the assessment of the Pulp mill and the detailed independent expert consultant’s reports. The millions of words spoken explaining their decision to vote for or against the permit are recorded on Hansard.

The majority of the legal argument advanced by the opponents seems to be centred on a whether a typographical error was made in the legislation, should it have been “or” or “of”.  Luckily when dismissing the application the Judge ordered the opponents to pay costs, so that the Tasmania taxpayer will not be out of pocket for yet another legal stunt.

The Federal Court on 9 April 2009 dismissed an application by a Victorian Group Lawyers for Forests to overturn the approval of the Pulp Mill by the Commonwealth Minister for the Environment.

Justice Tracey dismissed all 9 counts raised by this well resourced group of activists. He upheld the right of the Commonwealth to determine the mill was a controlled action under the EPBC Act as well as its approval subject to conditions that will safeguard Commonwealth Environment Values.

Amazingly this group of Victorian Lawyers did not challenge the upgrading of the Maryvale Pulp mill to elemental Chlorine Free (ECF) or its discharge of treated waste water into Bass Strait with a Dioxin limit of 20 pica gram per litre almost 6 times the concentration approved for Tasmania.

 The Lawyers argued against providing a security of costs (requested at a minimal $100,000) for their legal action. Now the question must be asked: is this legal action to be funded by the taxpayer?

In this global financial crisis, taxpayers should not subsidise the legal follies of a group of lawyers. Taxpayers’ funds should not be diverted from essential welfare and health services.

This group of activist lawyers are continually making legal submissions, lobbying and staging events to publicise their cause. They have also been fund raising and claim to have tax deductible charity gift status as an “environmental” group.

Failure to impose the costs of this failed legal action on these activists will only encourage more delaying and ill conceived court actions, like the failed attempts by the Wilderness Society, a $10 million dollar lobbying business propped up by tax deductible “charity” donations.

The developer has stated that the Federal Court outcome reinforces the diligent and comprehensive process underlying the project approval.

The dismissal of the court case comes only a fortnight after Tasmania marked 20 years of missed opportunity when in March 1989 the Federal government moved the goal posts on the Wesley Vale Mill proposal.

March 1989 saw the demise of the Wesley Vale pulp mill, a modern world class pulp mill proposed as a joint venture between local forest owner North Forests Products and a Canadian pulp and paper manufacturer.

It followed a history of substantial investment into new pulp and paper mills since the mid 1930’s 1940’s when pulp and paper mills established at Burnie and Boyer and the site was near the Wesley Vale pulp and paper mill built in 1971.

At the time Australia did not have an export pulp industry. 20 years ago the country earned $370 million a year from exporting about five million tonnes of woodchips, but paid $1.3 billion for its annual import of one million tonnes of pulp, paper and paper products.

The decision on the Wesley Vale mill cost 2400 jobs during construction and 700 jobs in operation as well as the chance to address the balance of trade problem. It also increased the sovereign (government) risk of investing in value adding forest products.

Many saw the action of the Federal Government as a political rather than an environmental decision, with the Tasmanian Premier stating on 15 March 1989 “The tragedy of this decision today is that it is a political decision which has been made firstly, because of the power of Senator Graham Richardson, … and secondly, for political reasons, to bolster the Labor Party's support in the green belt of Sydney and Melbourne.”

So while many Tasmanian working families face an uncertain future due to the global financial crisis, the recent announcement of Paperlinx to review the operation of its paper mills at Wesley Vale and Burnie, the opponents to the Wesley Vale Mill have celebrated, ironically they included many of the people that have also opposed the current development.

However much has changed since 1989. There has been a massive increase in the amount of forest reservation to a massive 47% (see page 79 of the linked report) .A Regional Forest Agreement was signed in 1997 that established both a comprehensive reserve system and a sustainable forest industry.

Pulp mill technology has moved on so much it’s like comparing a 1980s TV with a new flat screen Plasma.  Bleaching no longer uses elemental chlorine gas, but chlorine dioxide.  This means that dioxins that were a concern two decades ago are now no longer significant.

The CSIRO undertook a National Pulp mill research program to establish environmental guidelines by 1995; these were updated by the Tasmanian RPDC in a 2004 and were accepted by both the State and Federal Government. These adopted world’s best practice and the use of either ECF or TCF bleaching that has made dioxins no longer detectable in treated mill.

The Tasmanian Chamber of Commerce and Industry was the venue of a recent presentation on the pulping, bleaching and waste water treatment technology to be used in the approved ECF kraft mill at the Bell Bay heavy industrial estate.

As part of Gunns Limited’s commitment to the project and its goal of achieving financial closure for the pulp mill at the earliest possible time, the company provided engineering experts to address business and community groups.

Both Andritz, who will design, build, install and commission the mill processing equipment, and Eimcowho will design, build, install and commission the effluent treatment plant outlined their corporate experience with pulp mill technology and gave assurances that Commonwealth and State guidelines would be met.

Both have financial guarantees backing contractual arrangements. Both explained that while financials guarantees were important, of far greater importance was upholding the corporate reputation in the global business world. Both also gave an opinion that the Bell Bay Pulp Mill when operating would become the benchmark against which future pulp mill proposals would be measured.

The presentation addressed the mill effluent issues, advising that the installed plant would meet all Commonwealth water quality objectives. The strategy in design of the technology is to ensure that what leaves the facility will not cause adverse impact to the environment i.e. Dilution within the receiving waters is not relied upon or necessary to ensure impact does not occur.

Andritz explained that the potential for dioxins to cause impacts was negligible. They explained that the level of dioxin in the effluent was so small that the world’s most sophisticated measuring equipment could not measure it, and if present at all would be significantly below the regulated limit.

The experts were also able to advise that the Tasmanian pulp mill’s technology would be equal or better than that used in Sweden. The environmental credentials of the Swedish pulp industry had been promoted in the lead up to the Federal Government’s approval of the mill.

The Minister for Innovation, Industry, Science and Research Senator Kim Carr publicly released on 20 April 2010 the Pulp and Paper Industry Strategy Group Final Report and announced the establishment of the Pulp and Paper industry Innovation Council.

The final report found that the Australian pulp and paper manufacturing industry directly employs nearly 19,000 people in over 440 businesses, many in rural and regional communities.

The industry generates $12.6 billion in domestic demand, produces total value added of about $2 billion and earns more than $1 billion in exports.

The Minister said “I believe that the industry has a strong future as long as it continues to attract investment, foster innovation and develop sustainable practices.”

“By doing so, it can build on its already significant social and economic contribution and continue to play a vital role in Australia’s future prosperity”.

Part of this future prosperity is the approved ECF pulp mill for the Bell bay industrial Estate.  The mill will produce up to a million tonnes of pulp from plantation grown pulp wood.  A major innovation will be that mill will also have a bio energy plant that will supply renewable energy to the plant and provide enough surplus renewable power to provide the electricity needs of a small city.

The establishment on an industry Innovation council will ensure that the pulp and paper industry can continue to be a major mitigation of greenhouse gasses.

On 8 Dec 2008 Mitsubishi Paper Mill commenced a tour of inspection and a series of meetings with Tasmanian stakeholders.  MPM export 200,000 bone dry metric tonnes of woodchips proceed at the Hampshire harvested from regrowth native forest and plantations in NW Tasmania.

The inspection was part of a process to gain Forest Stewardship Council, mixed source wood certification. FSC is yet to finalise country specific criteria for Australia and whilst it has issued some certificates in Victoria and WA, is yet to certify Tasmanian forests.  However Forestry Tasmania, Gunns Ltd and Forest Enterprises Australia have been externally certified as complying with the international standard for environmental management systems (ISO 14001) and have also been externally certified against the Australian Forestry Standard (AS 4708) that is endorsed by Programme for the Endorsement of Forest Certification Schemes  (PEFC).

Both the PEFC and FSC promotes sustainable forest management - environmentally, socially beneficial and economically viable management of forests for present and future generations - through independent third party forest certification.

To meet the FSC controlled wood categorization MPM wanted to satisfy itself that the harvested wood not be:

• Illegally Harvested Wood
• Wood harvested in violation of traditional or civil rights
• Wood harvested from forest in which high conservation values are threatened by management activities
• Wood harvested from areas being converted from forests and other wooded ecosystems to plantations or non-forest uses.
• wood from forests in which genetically modified trees are planted

Prior to their visit a risk analysis confirmed that all wood was legally harvested and that it did not violate any traditional or civil rights and that GMO is banned in Tasmania. They were also aware that high conservation values are protected within Australia through the

• the Convention of Biological Diversity (CBD)
• Convention on International Trade in Endangered Species (CITES)
• Ramsar Convention on Wetlands
• World Heritage Convention

The Regional Forest and Tasmanian Community Forest agreement are in accordance with these conventions and reserve 47% of Native Forest, 97% of high quality wilderness and a million hectares of old growth. This level compares to the CBD of 10%.

However they appeared unaware that these agreements also protected threatened species through a combination of reserves and management prescription. The risk assessment listed possible concerns with the wedge tailed eagle, quoll, burrowing crayfish and masked owl. Part of the inspection was to find out the details such as the massive increase in recorded wedge tailed eagle numbers since the introduction of the Forest Practice Code. There are also detailed prescriptions available from the independent Forest Practices Authority- Fauna Values Database

The second risk factor of concern was the conversion of native forests to plantations. Both Forestry Tasmania and Gunns had announced an end to this practice in July 2007  (see Forestry Tasmania  Statement). Due to recent discussion with community stakeholders, Gunns recently issued an information sheet on the issue that can be accessed here.

Even so, FSC does allow a small rate of conversion if needed to protect values. In Tasmania part of the RFA and TCFA was to provide intensive forest management of low conservation value forest including thinning and plantation establishment to establish future timber resource when timber rich areas such as Beech Creek/Counsel River, Wylds Craig, Gordon and Tiger Range, Upper Styx, Middle Weld, Middle Huon, Picton Valley, Southeast Cape and major areas of the Upper Florentine were reserved.

Incredibly, despite these reserves the recent IUCN Congress passed a motion condemning Tasmania due to these areas being threatened by logging activities.

An important article has been published  at Online Opinion  by Mark Poynter.

Mark Poynter is a professional forester with 30 years experience. He is a member of the Institute of  Foresters and the Association of Consultant Foresters, and author of the book Saving Australia’s Forests and its Implications (published in 2007).

Marks article looks at two recent publications by the Fenner School of the Australian National University.  The first by the WildCountry Hub director Professor Brendan Mackey and colleagues that colour codes carbon and speculates that there is ten times more carbon potential in forests than a world wide estimate made almost 20 years ago.

The second report critiqued is from Judith Ajani (formerly Clark) that extensively quotes the Mackey report to argue that native forests should be used as carbon stores, and existing plantations will provide all our timber needs.

Both reports appear strongly influenced by the Wilderness Society and its political ally the Greens.

The reports critiqued are in direct contrast to the carbon credentials of timber and paper outlined at a new web site.  Did you know  Australia’s native forests, timber plantations and wood products are net absorbers of greenhouse gases, sequestering 56.5 million tonnes of carbon dioxide in 2005, reducing Australia’s total greenhouse gas emissions by nearly 10%.

Check the latest information at Wood Naturally Better web site.

Of all the options for responding to climate change, forest-related mitigation measures are, in the short to medium term, among the most practicable and cost-effective. They also have very low opportunity costs and can make an immediate and direct contribution to sustainable development and rural livelihoods.

The Head of the Forest Conservation Programme at IUCN, the International Union for Conservation of Nature released this land mark statement supported by World Business Council for Sustainable Development who added:

"All of us have a shared responsibility to insist on sustainable forest management that produces fiber for wood and paper products, bioenergy and that also provides critical ecosystems services such as carbon sequestration and water quality,"

For more details see the report at the WBCSD