Optimism for Burns Lake mill

Zika working to bring positive message to Hampton board meeting.

On Oct. 30 Steve Zika, Chief Executive Officer of Hampton Affiliates, stopped by the Lakes District News to talk about the current state of affairs regarding the rebuild of the Babine Forest Products sawmill.  The province, the Village of Burns Lake and local First Nations have all expressed a willingness and commitment to find enough fibre supply that will justify rebuilding the mill while not excluding current license holders from the Lakes Timber Supply Area (TSA).

But this kind of arrangement, where local governments work together to support private investment in a local sawmill is new and untried.  “The government was clear that they’re not going to disturb any other licensees or take anybody’s license away from them,” said Zika.  “They’re trying to create something from a very difficult situation.”

On Sept. 17, the province announced that it was going to offer a new community forest license of 150,000 cubic meters of Annual Allowable Cut (AAC) to ‘the Village of Burns Lake and First Nations’, as well as an additional 380,000 cubic metres of harvest from low volume stands.

Other commitments were an increase in tree farm licenses to First Nations as well as the conversion of volume based harvest licenses to area based licenses.  This conversion is widely regarded as increasing good forest stewardship as license holders become responsible for particular areas of forest rather than staking an annual claim on loosely defined tracts of land in competition with other license holders as they scramble to find the most profitable patches of forest.

Minister Pat Bell described these new commitments as being within the context of supporting the rebuild of the Babine sawmill.

At the same time that the province was initiating an intensive, deep inventory of pine beetle affected forests throughout various TSAs, with Burns Lake being one of the first.

This drew the criticism that the province was being contradictory in ‘finding’ more allowable annual cut before completing forest inventories.  Counter assertions from John Rustad, Parliamentary Secretary for Forestry, that forest inventories were being maintained on an annual basis and that the province wasn’t working blind were not given much media credence.

The intimation that any new timber supply would be committed to Hampton or to any other mill has also raised alarms within the logging industry.  Klaus Posselt of Tahtsa Timber remarked that, “The market has got to be open.”

“That wood has to be available to get the best value for the community,” Posselt said.  “Babine [Forest Products] should pay as much as the next mill.”

Zika reiterated what he had said before in Burns Lake, “We’re committed to paying a fair market price.  It’s not going to be any kind of subsidized wood that we’re going to buy from a community forest or anybody else.  We recognize that we have to pay a fair market value.”

But the question remains of what ‘commitment’ can mean when it comes to the Dec. 3 board of directors meeting of Hampton Affiliates that will give the final decision about the mill rebuild.

“I don’t think that you can make a black and white commitment,” said Zika.  “I can’t tell you that it has to be this exact black or white thing, but we have to see positives rather than negatives.”

It’s not that Zika and the board of Hampton Affiliates are looking for timber supply handed over to them in writing.  They’re are looking for all the pieces of the local timber supply puzzle to come together in a way that make sense from an business point of view.  “The government as been good about creating options for us, and now the community is working through those options,” said Zika.  “We’re all sitting down trying to come up with the right answer.”

The Village of Burns Lake, the Regional District of Bulkley Nechako and First Nations have been working to establish the new community forest license offered by the province.  Burns Lake Band Chief Albert Gerow recently confirmed that the new community forest will be made of board members representing all three stakeholders, with the management details not yet finalized.

One potential hitch in the proceedings is that the province is expecting preliminary results this winter from field work carried out in the Lakes TSA regarding a detailed and comprehensive photo-inventory of the entire region.  Those preliminary results will allow the chief forester to make an assessment of current AACs to determine if they should remain as they are or be lowered.

Zika is not concerned that a lower AAC would negatively impact their plans to rebuild the mill.

“As you can remember in our presentation to the timber supply hearings [last summer] we were lobbying that the AAC needs to come down to save mid-term timber supply,” said Zika.

In his presentation in Burns Lake on July 19, 2012 Zika called for an immediate drop in the AAC while at the same time suggesting that mills should focus their harvesting within their own local TSAs.

“They were going to need to evaluate the proper level of harvest anyway,” Zika said.

“I think they’re still learning about how the pine beetle has affected timber supply.  I don’t see it as a negative if in one or two years they reduce the harvest.”