farmdoc's blog post number 217

On 26 May 2008 40-year-old David Bartlett became Tasmanian Premier when Paul Lennon suddenly resigned. Regarding Gunns’ pulp mill proposal, Premier Bartlett’s on the record saying I have drawn a line-in-the-sand that says if the proponent can't meet the requirements of the permit and gain finance and substantially commence the project by 30th of November this year then enough is enough (ABC News, 2 July 2008). It can’t. It won’t. In June Premier Bartlett extended the sovereign-risk agreement with Gunns to 30 November – hence the ‘line-in-the-sand’ date. Withdrawal of government support beyond then should include the wood supply agreement between Forestry Tasmania and Gunns, which commits the sale of publicly owned native forests to the pulp mill for 20 years, because Forestry Tasmania’s a government agency. A poll has revealed 73% of Tasmanians want the Premier to maintain his 30 November 2008 line-in-the-sand. Meanwhile, depending who you listen to, the mill project’s either dead or shelved. Gunns is reluctant to declare it dead because that’d mean the tens of millions of dollars already spent, would automatically convert from capital to expense, thus reducing its profit when its share price is plummeting much faster than the S&P/ASX200. Finally if, as I expect, Premier Bartlett reneges on his line-in-the-sand, he’ll hasten the day when the tide of public opinion obliterates him from the political beach.