The state's Environment Protection Authority has given its approval for a new $54 million woodchip mill at Bell Bay.
The proposed development, by Patriarch and Sons, is to take place over three stages.
The first will be for rotary peeled veneer leaf production, the second for dried rotary peeled veneer leaf, and the third for plywood.
The mill will be fed with a mixture or plantation and native forest resources.
Stage one of the project is expected to start in late July with the first exports to leave the mill a month later.
Stage two will progress over May to August when a boiler is installed with production to start from January 2020.
The final stage is expected to gradually occur over that year.
According to documents lodged with the EPA, the facility will operate 24 hours a day from Monday to Saturday.
The construction phase is predicted to take nine months and employ 30 people.
The documents said there would be no additional log transport traffic as the harvested timber already flowed to the wood chip mills within the Bell Bay area.
The company has forecast the employment of 109 full-time equivalents when the mill is fully operational.
It is expected the mill will produce 96,000 cubic metres of plywood and up to 80,000 tonnes of woodchips each year.
EPA director Wes Ford determined the mill could be managed in an environmentally sustainable so far as certain air and noise emission conditions were complied with.
“Air emissions will be addressed through emission limits on particulates and oxides of nitrogen, and stack testing, and noise will also be managed through emission limits,” he said.
The development would still need final approval by the George Town Council.
Greens leader Cassy O'Connor said the company had links with Shin Yang Group of Companies which she said had questionable logging operations in Borneo.
She said questions remained on where the timber to service the mill would come from.
"What we do know is that the mill will need 250,000 tonnes of timber a year and some of that will come from native forests," Ms O'Connor said.
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