A logging company owned by the family of Sarawak Chief Minister Abdul Taib Mahmud has agreed to the Australian government buying back 40 percent of its controversial logging rights in Tasmania for A$28.6 million (RM84.8 million), says whistle-blower website Sarawak Report .

The Australian government has now bought back the 108,000 metres per annum of land from Ta Ann and placed it under a protected status.

The move by the Australian government came as a "peace offer" between environmental groups that have been protesting against illegal logging by Ta Ann in the state of Tasmania.

NONE Ta Ann is owned by Taib's cousin Hamid Sepawi ( left ), who is also the chairperson of the company.

Ta Ann Tasmania, the company's branch in Australia, received logging rights in Tasmania in 2006 with an A$8 million (RM23 million) subsidy from the government to set up two logging mills in the island.

According to Sarawak Report , the company initially claimed it would only use plantation wood for its mills. However it later admitted to logging in the wild forest as the supply of plantation wood was not enough for its mills.

But why were the contracts given out?

While many NGOs have welcomed the deal to protect the forest, many questions have been raised as to why the contracts were given out in the first place.

"Closer scrutiny is required on the original contract to determine how such an injurious agreement to Australia's taxpayers was secured," Sarawak Report quotes Jenny Webber of the Huan Valley Centre, a local environmental protection NGO, as saying.

NONE Questions on the integrity of some senior Tasmanian politicians have also been raised after Ta Ann chose to build its two timber mills in the constituencies of the state Energy Minister Bryan Green, and former state forestry chief executive Evan Rolley, both key supporters of the company.

Rolley is now chief executive of Ta Ann Tasmania.

The Australian Greens, the third largest political party in the country, has criticised the agreement and compensation paid to Ta Ann.

However, both the Australian government and Ta Ann said the payout was necessary to ensure that the mills remained open and the jobs of the workers stayed secure.

The Greens has been a long-time critic of Ta Ann and its logging practices. In 2012, it mounted a campaign that convinced about half of Ta Ann's Japanese customers to stop buying its wood.

azlan The Greens also criticised Ta Ann's treatment of indigenous groups in Sarawak, as well as a suspicious deal with Tasmanian state-owned company Hydro Tasmania and another Hamid-owned company to build a dam in Sarawak.

"There is a very worrying relationship between the exploiters of Tasmania and the exploiters of Sarawak," the then Greens party leader Bob Brown said in 2012.

Another company owned by Hamid was kicked out of Liberia in January this year for "massive fraud, misrepresentations, abuses and violations", says Sarawak Report , quoting Liberian president Ellen Johnson Sirleaf.