The Tasmanian government has finalised a $15 million loan to Boyer Paper Mill to keep the Derwent Valley operation running while it shifts to new products.
The loan provides up to $10 million for working capital and the transition to new paper lines, with a further $5 million set aside for capital projects including a proposed electric boiler.
Boyer directly employs more than 320 people and estimates it contributes more than $180 million a year to the local economy.
It is the last paper mill of its kind in Australia.
Tasmanian Skills and Workforce Minister Felix Ellis said the mill faces a tough market as demand for newsprint continues its long-term decline.
“Boyer is a major employer in the Derwent Valley and an important part of Tasmania’s manufacturing and freight supply chains,” Ellis said.
“This loan gives Boyer the opportunity to implement its transition plan, diversify its products and strengthen its operations.”
Ellis said the company is working to branch into products such as copy paper.
“I think it’s fantastic that we’ll have more Australian-made copy paper that will be made right here in Tasmania,” he said.
The loan is secured by a mortgage over the Boyer site, security over company assets and corporate and personal guarantees.
There are also strict conditions on dividends, asset sales, additional borrowing and related-party transactions.
“These arrangements provide strong oversight and protect the State’s position, but Boyer remains responsible for delivering a commercially sustainable future,” Ellis said.
The loan followed extensive commercial assessment and negotiation and will be monitored by Tasmania Development and Resources.
The government said it will continue working with Boyer on its longer-term energy transition plans.
Asked whether the need for a government loan should raise concerns about the mill’s future, Ellis said the support was about backing Derwent Valley jobs while Boyer works through the shift away from a declining market.
