A spokesperson said the work at the Bell Bay site would cost about A$50m and take 14 months to complete. In the long term it would lead to 100 more jobs.
Rival Auspine, which lost the agreement, said 300 mill jobs were now under threat.
Softwood mill expands
Australian timber plantation company Forest Enterprises is to expand its softwood mill in northern Tasmania after winning a 10-year deal to supply 290,000 tonnes of Tasmanian-grown pine a year.
