Water and the proposed pulp mill

NOTE: The letter below appeared in The Examiner today and has been published here with the author's permission.

Dear Editor,
According to the pulp mill's Integrated Impact Statement, 29 gigalitres of water per year will be required from the Trevallyn Dam (The Examiner, July 15).

On my calculations, based on what I pay for my domestic usage, this would mean an annual water bill of more than $10 million.

Will this affect the economic viability of the mill or will the water be subsidised because of the importance of the project?

If there is to be a subsidy, how will its level be determined?

Would it not be cheaper to take the water from the Tamar River near the mill site and return it, pollutant-free, as we have been assured it will be, into the river, rather than piping it all the way from the dam and then to the coast?

I am neither an engineer nor an economist, so perhaps I have missed some vital point, but I would like an explanation about these matters.

- TIM THORNE, Launceston.

In the letter that followed John Hawkins of Chudleigh pointed out:
• To build a pulp mill Gunns Ltd planned to spend $1.4 billion;
• Gunns Ltd share price has fallen 34 per cent in the last financial year;
• Gunns Ltd is the ninth worst performing stock on the Australian Stock Exchange.
He went on to ask "How can [Gunns Ltd] afford to spend $1.4 billion dollars on a pulp mill when its capital value, based on a share price of $2.75 is $880 million? ( At 2pm 24.07.06 the price was $2.540)

Good points Mr. Hawkins, and we can only assume that Gunns Ltd will be explaining all that to the assembled masses at their invitation only Day-of-Spin at the Grand Chancellor Hotel next Thursday. It'd be interesting to see how it goes down with the investors!