The Australian government has given the go-ahead for construction of a controversial aus $2-billion (us $1.8 billion ) pulp mill on the island state of Tasmania. Conservationists fear the mill will destroy the region's native forests and threaten endangered species.

The mill will be built in the island's Tamar valley. Conservationists say the pulp mill, which, it is estimated will consume 500,000 tonnes of wood every year, will source 80 per cent of its raw material from the native forests. It will affect the biodiversity of the island, which is home to threatened species, such as the Tasmanian wedge-tailed eagle and the Tasmanian devil, the largest carnivorous marsupial, and will have a serious impact on the island's marine environment, they say.

Environment Minister Malcolm Turnbull allayed these fears saying the government plans to impose the world's toughest environmental regulations on the project.