EPA rejects claims over Gunns mill

The EPA concluded that Gunns had "substantially commenced" the $2.3 billion Tamar pulp mill project and that, based on the evidence, more than $120 million had been invested — supporting the view that the project's environmental permit remained valid.

In this case the EPA director found that the level of progress and investment in the project met the threshold for "substantial commencement," meaning the company satisfied the requirement to avoid the lapsing of its environmental permit as of the August 30 deadline.

The opponents, a group called Pulp the Mill, launched action in the Tasmanian Magistrates Court alleging Gunns had begun development without a valid permit and had failed the substantial start test after nearly seven years with the project not financed and foundation earthworks only starting on August 29.

The EPA's consideration was triggered when Gunns sought a minor variation to the mill site's stormwater management plan, prompting review of whether the permit was still valid given claims it might have lapsed.

Alex Schaap said that even under his most restrictive interpretation of the project's progress, the evidence showed an amount in excess of $120 million had been invested, consistent with substantial commencement.

The EPA director said he would continue to regulate the site on the basis that a valid permit existed, unless a court determined otherwise.

After coming out of a six-week suspension on September 20, Gunns said it remained focused on the mill. Managing director Greg L'Estrange would not provide details on financial close but said negotiations were "well advanced."

According to the article, Gunns' shares fell to a low of 15.5 on September 23 and then closed at 18 the following trading day.