Council looks at legal action to recover loan
Supreme Court intervention is being considered in an effort to recover an outstanding loan amount offered by Edward River Council to the company proposing to build an ethanol plant in Deniliquin.
It further places the development of the facility at Deniliquin under a cloud, despite Mayor Norm Brennan saying he still holds hope the project will come to fruition regardless of the potential legal action.
Dongmun Greentech was provided with the loan by the former Deniliquin Council in 2014 to purchase land at Geelong which would eventually feed in to its plant at Deniliquin.
Following its merger with Conargo Shire to form Edward River in 2016, the council started the process of recovering the longoutstanding loan earlier this year.
It succeeded in recovering just over one third of the loan by selling off two of three blocks purchased by the company at Geelong using the council loan.
Cr Brennan said requests to have the remaining $600,000 repaid have so far gone unanswered.
Council decided at its December 20 meeting, in confidential committee, to take the matter further.
‘‘As a result of the failure to meet with the directions issued (to repay the loan) we have decided we may go to the Supreme Court,’’ Cr Brennan told the PASTORAL TIMES.
‘‘Given we have been unable to make contact with anyone from the company or their legal representatives, our recommendation is to go through that process.
‘‘It could result in the release of the rest of the land for us to sell and recover what is owing.
‘‘If we do go down that path, the costs associated with going to the Supreme Court would also be deducted from that sale.’’
Cr Brennan said potentially impacting on council’s plans is that there are reportedly other claims on the land owned by Dongmun Greentec in Geelong.
‘‘The land cannot be sold if there is a caveat on it,’’ he said.
In August, Cr Brennan indicated the remaining land held by Dongmun Greentec was large and valuable. He said its sale would recover more than what is owed to council.
Any surplus funds after all costs are recovered will be returned to the company.
Cr Brennan said it is not clear whether this recent development will have an impact on the plans for an ethanol plant to be built in Deniliquin.
He said while confidence and enthusiasm is depleted, council would still like to see the project proceed.
‘‘We are very hopeful Dongmun Greentec can get something going,’’ he said.
‘‘Council would be still happy to work with them towards that aim.’’
A 147.18ha industrial block on Barham Rd has been earmarked for the ethanol plant project, which is expected to be large enough to produce 110,000 kilolitres of ethanol each year and up to 92,000 tonnes of dried distilled grain.
The development process has been ongoing since Korea-based Dongmun president Sung Ho Joo’s first visit to Deniliquin in December 2013.