A company which sought to buy State forest land at Glen Ding Wood, Co Wicklow, five years before it was eventually sold by private treaty to Roadstone Dublin Ltd was told it could be sold only by public tender.
Mr Michael Smith, who was minister of state for forestry in 1987, also made it clear to the company, Hudson Bros, that the land was not available for sale or lease.
However, in January 1992, the 147-acre site was sold by private treaty for £1.25 million to Roadstone Dublin Ltd, a subsidiary of Cement Roadstone Holdings (CRH).
A spokesman for Mr Bobby Molloy, who was minister for energy in 1992, said last night that when Mr Molloy approved the sale, he was not aware that Hudson Bros had expressed interest in buying the land. As far as Mr Molloy was concerned, the only two interested parties were CRH and a businessman, Mr Brendan Johnston.
Hudson Bros, a quarrying company based in Brittas, Co Dublin, inquired about the possibility of buying the land which has sand and gravel deposits in January 1987. The company asked local Fianna Fail TDs Mr Chris Flood and the late Mr Sean Walsh to make representations on its behalf to Mr Smith.
In identical letters to Mr Flood and Mr Walsh, Mr Smith stated that "even if the deposits were available for sale, the area could only be offered for sale by public tender competition in accordance with Department of Finance-delegated sanction for such sales".
CRH had first approached the Department of Energy about buying the site on August 28th, 1987, almost eight months after Hudson Bros had expressed its interest in a letter to a forestry official.
Mr Johnston sought to buy the land in 1989, but was told by officials in the Department of Energy in 1990 that his offer had been unsuccessful and the property had been sold by private treaty.
The Department of Marine and Natural Resources, which now holds the files on the sale, said last week that "strategic advantages" favoured Roadstone's offer because it was an adjoining landowner.
However, Hudson Bros also operated a quarry adjoining Glen Ding Woods, which would have given it access to the property sold by the Department of Energy.
Mr Devin Hudson, of Hudson Bros, wrote to Mr Smith earlier this year seeking an explanation as to why the land was sold by private tender after Mr Smith had said in his letters to Mr Flood and Mr Walsh that it could be sold only by public tender competition.
In his letter to Mr Smith, sent on February 6th this year, Mr Hudson said: "After receiving this letter in 1987, Hudson Brothers ceased a year-long quest of attempting to purchase Glen Ding. We would appreciate if it could be explained to us why our company did not receive a tender which would have enabled us to make a bid on the land."
After receiving Mr Hudson's letter, Mr Smith, now Minister for Defence, referred the matter to the Department of Marine and Natural Resources. The Department sent a letter to Mr Hudson on April 29th, stating that independent consultants had advised it was unlikely Roadstone's bid would be matched.
Mr Kiaran O'Malley, the independent consultant commissioned by the Department, had advised in April 1990 that the property should be sold by public tender but six months later he recommended a sale to Roadstone on the basis of its bid.
Mr O'Malley has confirmed that he had previously carried out a small amount of consultancy work for Roadstone before 1989.
The chairman of CRH at the time was Mr Des Traynor, who looked after the personal finances of the Taoiseach at the time of the sale to Roadstone, Mr Charles Haughey. However, CRH has said that Mr Traynor played no role in the purchase.
A statement on behalf of Mr Smith last week said that the "substantial developments leading to the sale of the land" occurred after his terms in office. "On that basis, the Minister is not in a position to respond to your queries."
Mr Smith served as minister of state for energy with responsibility for forestry between March 1987 and November 1988 and subsequently as minister for energy from November 1988 to July 1989, after which he had no further responsibility for forestry matters such as Glen Ding.
The Department of Marine and Natural Resources said the independent consultant, Mr O'Malley, advised the minister for energy at the time, Mr Molloy, that the Roadstone offer was "a very satisfactory outcome and that realistically it would be unlikely that any other potential buyer would either match or exceed that offer considering the planning difficulties to be faced and the strategic advantages which undoubtedly favoured Roadstone as an adjoining property owner.
"The Department's files indicate that a number of parties were interested in the lands, including Hudson Bros, prior to the decision to dispose of the lands to Roadstone. None of these expressions of interest were pursued by the Department of Energy at the time."
The Labour TD and former Minister for the Environment, Mr Brendan Howlin, said the documentary evidence relating to Hudson Bros's attempt to buy Glen Ding raised "serious questions" as to the private treaty sale. He had written to the Minister for the Marine and Natural Resources, Dr Woods, demanding an explanation as to why it was sold privately.
"The fact that in a very short period it was sold, was not sold by public tender, and that nobody sought to revert to the original application, strikes me as absolutely amazing," said Mr Howlin.
Fianna Fail TD for Wicklow Mr Dick Roche said he was "absolutely flabbergasted" by the latest disclosures which raised fundamental questions about the procedures adopted by senior officials.
The files should now be examined by the Dail Public Accounts Committee.
"There will be no end to public suspicion about this until all questions are answered and they are not being answered now."
Mr Flood, who is now Minister of State for Tourism, Sport and Recreation, said he had "acted properly" when he had made representations on behalf of Hudson Bros, which operated in his constituency. "If there has been a significant departure from what the Minister laid down, then I am very surprised."
The Fine Gael TD and former minister for agriculture, Mr Ivan Yates, said if the Hudson Bros offer was on the Department file when it was sold, it raised serious questions about the private sale.