Tasmanian logging giant Gunns Ltd announced suddenly on March 14 that it was withdrawing its proposal to build a $2 billion pulp mill at Bell Bay in northern Tasmania from the independent Resource Planning and Development Commission (RPDC) and called on Labor Premier Paul Lennon's government to legislate to approve the project.
Gunns said the Bell Bay pulp-mill project must be given approval before June 30 or the company would build a pulp mill outside of Tasmania.
Lennon moved quickly to accommodate Gunns' wishes, calling a special cabinet meeting that same night at which it was agreed that the pulp mill project would be fast-tracked for approval.
Legislation for a new assessment process for the pulp mill, by-passing the RPDC, was expected to be drawn up over the following weekend and taken to cabinet by Lennon on March 19.
Only two weeks earlier, on March 3, 1500 people had rallied in Launceston to protest against Gunns' proposed pulp mill. Organisers of the protest pointed out that the pulp mill would have "devastating water supply effects". It would use 26 gigalitres (26,000 million litres) of water annually.
According to the March 4 Launceston Examiner, ABC TV gardening show host Peter Cundall told the protesters: "I believe that this pulp mill would be a colossal mistake. It would rob the people of West Tamar of their drinking water. Supplies on the West Tamar are already low and problematic."
Earlier this year two members of the RPDC resigned in disgust at what they said was political interference by the Lennon government in the commission's assessment of the environmental and economic impact of Gunns' proposed pulp mill.
During a parliamentary session on March 15, the Greens put a motion of no confidence in Lennon. Labor and Liberal MPs voted the motion down without discussion.
Greens MP Peg Putt told a 500-strong rally outside the parliament that the close relationship between the premier and Gunns is "a blatant case of cronyism and sails us into the waters of corruption".
The rally was also addressed by Greens Senator Christine Milne, who stated that the pulp-mill fiasco is now a federal election issue. She invited both PM John Howard and federal Labor leader Kevin Rudd to come to Tasmania and see the proposed site of the mill for themselves.
Gunns cited costly delays as the reason it has pulled out of the RPDC process. However, it was pointed out at the rally by Geoff Law, the Wilderness Society's campaign coordinator, that a year's worth of delays were the result of Gunns not fully cooperating with the RPDC.
Residents in the Tamar region, where the site of the proposed mill is situated, have noted the potentially large environmental and health impacts of the proposed pulp mill.
Jim Collier, from the Tamar region residents' protest organisation Tasmanians Against the Pulp Mill, told the rally that "Hydro Tasmania would be required to provide three million litres of water an hour to this mill while Launceston residents will be facing water restrictions if it doesn't rain heavily in the near future".