place: Bell Bay/Tamar Vallery
purpose: bleach Eucalypt woodchips and pulp them for sale to North Asia - Tasmania is closer to the North Asia market than rival pulp suppliers in South America.
envronmental issue: the release of effluent, especially
dioxins, into Bass Strait. Gunns is planning to feed timber from the native forests of the north-east into the mill in the initial years of the operation (planned to be all plantation timber within five years. The Wilderness Society says it will initially be 80% native forest fed.)
alternative site: Hampshire
business issues: can Gunns raise the funds? Gunns interest payments in 07-08 were more than its earnings. Gunns has raised $500m in capital ($330m from equity raising and $170 from selling off pine plantations), concern with Gay being CEO and chairman, mill would tripled Gunns' earnings and turn it into a global player, Gunns market capitalization is $730m. Gunns needs to roll over $162m in debt in December 2009 against a debt facility of $178m
cost: $2.2 billion
status: 4 Jan 2009 Garrett said Gunns could build but could not operate till environmental model shows there is not problem with effluent outflows.
Source: The Age and the Australian.
Note: How many old growth forests are Gunns responsible for having logged? If Gay hadn't built Gunns into the business it is today would those forests have been logged?
Note: Gunns have hired Sydney PR company Cato Counsel to turnaround years of publicity.
Note: Last pulp mill push 20 years ago was led by Robin Gray, ex-premier of Tas.
Note: Australia has a $2b deficit in wood products.
Further background:
Gunns owns all 4 export-woodchip mills in Tasmania.
It is the largest native-forest logging company in Australia as well as being the biggest hardwood-chip company in the world. (Where's the largest chip company?)
It exports more woodchips from Tasmanian than are exported from all the mainland states combined.
Gunns owns 2/3rds of the eucalypt sawmilling industry in Tasmania.
Gunns owns two major eucalypt veneer mills in Tasmanina.
Key woodchip customers: Oji, Nippon and Mitsubishi.
Source: Greenpeace
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