Gunns reviewing settlement offer from Tasmanian government in connection with Forest Agreement, expects decision by Sept. 2 deadline

LAUNCESTON, Australia , August 31, 2011 (press release) – Tasmanian Forests Agreement

The company has received an offer from the State government in respect of a settlement proposal to support implementation of the Tasmanian Forests Agreement. The offer is open for acceptance until Friday 2 September 2011. The offer and associated documentation is being reviewed by the company and discussions to clarify specific aspects of the offer have been held with the State government. It is the company’s intention to advise the State of its position in respect of settlement of the matter by 2 September 2011.

As has been outlined previously by the company, satisfactory settlement of the Tasmanian Forests Agreement is essential for creating a satisfactory environment for both the traditional industry and new investment in the State.

The company will provide an update to the market on the conclusion of the process.

Pulp Mill Project Works

The company has executed a contract for bulk earthworks at the site and these works commenced on 29 August 2011. The company has undertaken substantial investment and works on the project. Expenditure of over $200 million to date has been incurred to finalise approvals, complete site roading and vegetation clearing, preparing construction, operation and monitoring plans and procuring equipment.

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