Long-delayed Tan Mai pulp and paper mills revoked

$220 million long-delayed Tan Mai pulp and paper mill have its investment certificate revoked

At present, the Quang Ngai Department of Planning and Investment, in collaboration with relevant authorities, has completed the procedures to withdraw the investment certificate of the Tan Mai pulp and paper mills complex, according to the assignment of the Quang Ngai People’s Committee.

In 2009, Tan Mai Group received the investment certificate for these projects. According to the initial plan, these projects would have a total investment capital of VND1.95 trillion ($85.6 million) with an annual pulp capacity of 130,000 tonnes and the annual high-end paper capacity of 200,000 tonnes.

The construction, covering an area of 45 hectares in Binh Son district, was expected to be kicked off in October 2009 to come into operation in 2011.

During the construction process the investor proposed the Quang Ngai People’s Committee to adjust the investment capital as well as the construction’s deadline no less than five times. However, the province only approved adjustments for the first three times. Accordingly, the investment capital was increased to VND5.01 trillion ($219.5 million) and the deadline for completing the construction of the pulp mill was adjusted to December 2012 and the paper mill to December 2013.

However, the construction was only kicked off in July 2010 and was suspended in December 2012. At the time of suspending the construction, the investor had only completed the environmental impact assessment report, the detailed construction plan, and took over the land to implement the project.

According to the conclusions of the province’s inspection team, the investor committed numerous violations between 2009 and May 2017.

Notably, Tan Mai failed to comply with the investment process, including failing to prove its financial potential for the added investment capital and delaying in the implementation of the construction.

Besides, the province completed the site clearance and handed over the land for the investor in May 2010, however, it was not until May 2017 that Tan Mai completed the procedures for the certificate of land use right.

In addition, the investor violated the construction schedule by being 52 months late with the pulp mill and 40 months late for the paper mill compared to the deadlines approved after the third adjustment.

According to the Quang Ngai People’s Committee, the investor’s lack of financial potential was the major cause behind the long delays. Thus, the investor will have to bear the entire responsibility for the incident.

Most recently, the Quang Ngai People’s Committee assigned the Quang Ngai Department of Planning and Investment in collaboration with the Quang Ngai Department of Natural Resources and Environment and other relevant authorities to revoke the investment certificate of these projects.

Tran Hoang Vinh, the representative of the Quang Ngai Department of Planning and Investment, told VIR that the department has completed the procedures for the revocation and will send the decision to the investor and wait for their response. Since the construction was suspended, the investor has yet to announce whether it will resume the projects or withdraw.

“In case the projects are officially revoked, the Binh Son District People’s Committee will take over the management of the land which was handed over for these projects. If a sufficient number of investors express intention to develop projects on the plot, the district People’s Committee will organise an auction for the land use right,” Vinh added.