MELBOURNE: The Australian Government has agreed to pay Sarawak-owned timber company Ta Ann Holdings Bhd (Ta Ann) A$26 million in compensation for wood supply the company is giving up as part of the forestry peace deal.
Under the agreement, Ta Ann would lose about 108,000 cubic metres or 40 per cent of its peeler log supply, ABC Radio reported.
Ta Ann said that meant its mills in the Huon and at Smithton will now have to run at 40 per cent below the capacity their machinery is built for.
The company said the compensation payout would ensure more than 90 employees keep their jobs. The money will be delivered in two tranches; one before the end of this month and another in September.
The compensation payments have drawn criticism from the Tasmanian Greens and environment groups outside the peace talks. The announcement has been welcomed by peace deal signatories, including the wilderness Society’s Warwick Jordan.
“It’s obviously a significant milestone,” he said.
Tasmanian Greens leader Nick McKim and the Huon Valley Environment Centre’s Jenny Weber want Ta Ann out of Tasmania.
“It’s not a company that here in Tasmania we should be Green-washing their practises,” Weber said.
The Premier Lara Giddings said supporting Ta Ann was vital for jobs and the peace agreement.
Ta Ann’s Evan Rolley told ABC Radio the company would try to restructure and find other sources of timber, but he could not guarantee there will not be job cuts.
“The world is full of uncertainty what we can ado is plan in a positive way for the future and that’s what this agreement does,” he said.
“It provides a firm confident basis for moving forward with our company.” — Bernama