The sale of the harvesting rights for the country’s state-owned forests has been abandoned.
Simon Coveney, Agriculture Minister, said the Government will instead focus on creating a new company – merging Coillte and Bord na Mona – to develop commercial bio-energy and forestry interests.
The minister said the decision to stall the sale of about one million acres of trees was based on concerns for jobs, public access and financial losses.
The sale had been forecast to make anywhere from €400-774m, but economist Peter Bacon had warned the Government that this could lead to a loss of €1.3bn over time.
It was also estimated that about 12,000 rural jobs would be in jeopardy.
Mr Coveney said the possible impact on the timber industry, public access to recreational land on 23,000km of roads, environmental and social impacts and consequential implications for Coillte were all taken into account.
He said now was not “the appropriate time” to sell the forests.
A future sale has not been ruled out with the Government saying that it will reconsider all options in relation to Coillte in 18 months time, once the restructuring and merger with Bord na Mona is complete.
“As I have said, on numerous occasions, the Government will continue to proceed carefully with the finalisation of any decision on this matter as we are determined to realise commercial potential but also to protect the public value that Coillte offers by maintaining public access to its forests and supporting the broader timber industry,” Mr Coveney said.
Mr Coveney said the Government considered a number of detailed financial, technical and specialist reports by external consultants in relation to Coillte before the decision was taken.
The Government is to press Coillte for the annual delivery of a financial dividend.
For 2011, the Wicklow-headquartered firm Coillte made a 10m euro payment to the Exchequer and reported pre-tax profits of €21m – down from €33m for 2010.
Richard Boyd Barrett, the People Before Profit TD who has campaigned against the sell-off, said it had been a scandalous proposal.
Several thousand people had attended protest walks in forests over the last months to oppose the sale.