Colin Barnett

Colin Barnett

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    Study shows WA well placed for a wood pulp industry

    6/12/2000 1:12 PM
     
    6/12/00

    Significant opportunities lie ahead for wood-based pulp mills in the South-West and Great Southern regions of the State.

    Resources Development Minister Colin Barnett said today international consultancy URS found these adjoining regions had the capacity to sustain a world-class plantation growing and processing province.

    He said their study confirmed that Western Australia was well positioned to make good use of its existing plantation timber reserves to grow a world-scale pulp industry based on sustainable timber resources.

    “It is no longer a question of if we can have this kind of industry, but when,” Mr Barnett said.

    He said the URS study looked at market opportunities, WA’s competitive advantage over other potential locations for similar industry ventures and the infrastructure needed to attract the investment, with a timeline out to 2015.

    Construction of the mills could begin by 2006 with commissioning as early as 2008.

    Among the study’s findings were that the development of large privately-owned bluegum plantations in the South-West and Great Southern regions over the last decade had made commercially viable a $500 million mechanical pulp mill located to the south-west of Bunbury and/or a $1 billion kraft pulp mill near Boyup Brook.

    “This timber resource is more than adequate to feed a world-class pulp industry, and will be ready for harvest in a few years,” the Minister said.

    “The other factor which has changed since Wesfarmers Bunnings rejected the possibility of a pulp mill in 1996 because of the commercial climate for pulp at that time, is that the price of energy in the region has fallen substantially as a result of increased competition in the energy sector.

    “I expect these factors will only make the case for the start of a pulp industry stronger in years to come.”

    Mr Barnett said the report stated that to support these investments by private industry, the Government would need to consider priority infrastructure projects worth up to $160 million.

    These could include roads, a power transmission line and gas and water pipelines.

    “The total cost would depend on the location of the mills and their type,” the Minister said.

    “The study shows regional benefits provided by these mills would include about 500 regional jobs and about $1 billion in annual income.

    “It also found that paper mills at both locations could follow in the longer term, bringing further dollar and employment benefits to the region and the State.”

    Mr Barnett said the release of the report was the latest in a series of steps taken towards establishment of a wood-processing industry for the South-West by the Government.

    He said to date these have included:
    • calling for expressions of interest to build a pulp mill in 1993;
    • a subsequent feasibility study by Wesfarmers Bunnings, which decided in 1996 not to proceed with a project for commercial reasons only; and -
    • commissioning of a review in 1997 of the commercial viability of a pulp mill, which concluded that it would be viable from about 2001.

    The broad findings of the URS report were first made public earlier this year, through a Vision Document released for comment in January which was received favourably by industry and public stakeholders.

    The Department of Resources Development then compiled a draft Wood Processing Industry Development and Infrastructure Strategy and Action Plan for Western Australia.

    This was released for comment in June 2000 before a comprehensive series of industry and public consultation meetings.

    The current estimated plantation timber resource of approximately five million tonnes will be ready for harvest within the next few years - two million tonnes around Bunbury, and three million near Albany.

    Media contact: Diana Callander - 9222 9686