$34m to get Gunns out of forests

Gunns will be paid $23 million to extinguish its residual rights to timber contracts, Premier Lara Giddings said yesterday.

Another $11.5 million would go to settling the company's disputed debts to state agency Forestry Tasmania.

The deal seals the company's exit from native timber logging and opens the way for protection of public forest where conservation battles have raged for a generation.

It was a long-awaited third milestone in a historic peace process that began nearly a year ago. Gunns turned down an initial offer that was $11.5 million lower.

Ms Giddings said the "resolution means that we have avoided the lengthy delays and costs that would inevitably be incurred if these issues were pursued through the courts".

In the next phase of the peace talks, a panel of experts will decide which forests will be protected because of conservation values, and which would stay open for logging.

Forestry Tasmania has claimed that at most it can only afford to protect 300,000 hectares and still meet other wood supply contracts.

The Greens, who hold Ms Giddings' minority Labor government in power, backed the deal. ANDREW DARBY