The Penola Pulp Mill, a $1.5b development north of Mt Gambier, was approved on September 12, 2006, following assessment by the Development Application Commission. Protavia is now investigating the implications of the Federal Government’s proposed carbon emissions trading scheme, reported Mount Gambier’s Border Watch newspaper on July 22.

This blow to Protavia comes just days after the South Australian Government repeated its commitment to standardise and upgrade the South East rail network to support the Penola mill project.

The Penola district is in the ‘Green Triangle Region’, which contains a wood resource that represents some 17 per cent of Australian plantations. The Penola mill project has international partners that include the German contractor MAN Ferrostaal AG in association with its strategic engineering partner, KSH Solutions Inc., Canada, and also ANZ Infrastructure Services Ltd, a private equity arm of the ANZ bank.

Border Watch reported that Protavia communications officer Jason Chappel said he was looking at the implications of emissions trading on development.

The Penola mill is designed to produce 750,000 air dried tonnes per annum of BCTMP pulp to supply predominantly export markets. It will consume to 1,400,000 tonnes of blue gum woodchip annually and produce 700,000 tonnes of hardwood pulp using a chemi-thermo-mechanical process.

In September, 2007, Greens MLC Mark Parnell described the lack of debate as a ‘disgrace’.

“We were told Parliament offered the highest level of scrutiny, yet two hours of debate was all the Lower House managed today – that is simply not good enough,” Parnell was reported as saying at the time.

However, Protavia’s Chappel said confidence remained strong surrounding the pulp mill and he expected construction to begin early in 2009.

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