Tiwi Islanders have succeeded in a 30-year battle to bring the first shipment of woodchip grown in plantations on their homeland north of Darwin to market. Source: The Australian
About 38,000 tonnes is due to depart for Japanese-owned paper mills and about $73 million has been invested in the project since it fell into Tiwi hands with the collapse of tax-minimisation firm Great Southern in 2009.
Singapore-based firms have ploughed $140m into Port Melville, through which the woodchip is being exported.
Under a five-year deal with Japanese conglomerate Mitsui to supply up to 400,000 tonnes of chips, or eight to 10 shiploads annually, the plantation project could generate $150m.
As dancers gathered to mark the occasion, there was a ceremonial atmosphere and sense of triumph and achievement.
Chairman of the Tiwi Land Council, Gibson Farmer Illortaminni, who has been involved with Tiwi forestry for many years, said it was “a Tiwi day”.
“We want everybody around Australia to see what we are doing,” Mr Illortaminni said. “We waited and waited, and now it’s come.”
Doubts persist about whether the port and plantation businesses – which have been pitched as “model” indigenous economic development, but have narrowly avoided bankruptcy several times and been marred by repeated controversy – will survive.
The first shipment is expected to fetch about $4m. It will take another two to three for the plantations to clear short-term debts, and until the middle of next year or beyond to know whether that business will be truly sustainable.
More than $16m in Tiwi money has been spent on the project, and millions more in taxpayers’ and other public funds including $6m recently from the Aboriginals Benefit Account, at least $1m from the Territory government and $2.5m in loans from the Export Finance and Insur ance Corporation.
Port Melville presently has no commercial arrangements besides woodchip export, after a controversy over environmental approvals that saw all existing deals “frozen.”
The chairman of Port Melville, Andrew Tipungwuti, said the first woodchip shipment marked the beginning of a “new era.”
“We hope there is no welfare here in the next five years. There is no excuse to have welfare here: this port and this woodchip industry is going to supply the jobs here … enough to cater for the whole island I imagine,” he said.
About 20 Tiwi people are presently employed in the forestry and port businesses respectively. Mr Illortaminni said the ambition was to create about 100 Tiwi jobs.
The Australian has been told Port Melville lost a key fuel bunkering contract over the environmental approvals controversy. Three fuel storage tanks totalling 30 million litres at the site sit empty.
But Port Melville’s chief executive, Larry Johnson, who has overseen the port redevelopment since it began in 2010, said the claims were incorrect.
Mr Johnson, who has previously spoken of negotiations with Pentagon officials over US military contracts, declined to say whether servicing navy vessels at Port Melville was still likely.
Industry sources said chances had improved since the Territory government controversially leased the Port of Darwin to a Chinese company last month.
When the redevelopment of Port Melville was first announced, it was conceived as a marine supply base for the oil and gas industry. But construction works were repeatedly delayed.
Under a profit-sharing agreement, it was expected Port Melville’s own commercial customers would cross-subsidise Tiwi businesses. For the time being at least, that agreement will work the other way around.
The general manager of Tiwi Plantations Corporation, Roger Smith, said that the first priority was to “get some cash flow so we can pay wages.”
