Nov 11, 2009. /Lesprom Network/. Australian forest company Gunns confirms talks with Södra regarding equity investment in the planned pulp mill project on the island of Tasmania, Australia, as Papernet reported. John Gay, Chairman of Gunns, told the company's Annual General Meeting in Launceston that the recent improvement in financial markets had provided an opportunity to progress the final stage of the Bell Bay pulp mill project. "The company is continuing to work positively with its banking group to close the project finance facilities," he said. "The company is also in dialogue with a number of parties regarding equity investment in the project. "The Swedish forest products co-operative Södra is one of these parties," Gay said. "The parties are continuing to work through detailed discussions in relation to the investment. Gunns expects the external equity investment in the project to be approximately 40% of the mill equity requirement," John Gay continued. The Bay Bell pulp mill is expected to have a capacity of between 800,000 and 1.1 million tons per year. Gay said the pulp mill would take advantage of Gunns' growing plantation timber resource. "Gunns has a long-term aim to transform the company from a native woodchip business to a plantation-based company," he said. "In the past 20 years, the company has purchased or secured more than 300,000 hectares of land for plantation development." "The company's resource development has been aimed at producing a product that replaces native forest woodchips which have traditionally been exported to Asia. Now the company is endeavouring to build a domestic pulp mill to process this plantation resource,” he said.