Government approves forest tenure transfer

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October 29, 2019
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B.C.’s minister for forests has approved the first forestry tenure transfer under a new tenure control act that was intended to address the concentration of tenure among major forestry companies in B.C.

Doug Donaldson, minister of Forests, Lands, Natural Resource Operations and Rural Development, has approved the transfer of a forestry licence held by Conifex (TSX:CFF) to Fort St. James Forest Products, a subsidiary of Hampton Lumber Mills, as part of its sale of a sawmill.

Earlier this year, Conifex curtailed production at its sawmill in Fort St. James, which it is selling to Hampton Lumber. Hampton has agreed to rebuild and reopen the mill.

“After a comprehensive review of this public asset, I determined that this transfer is in the public interest and will benefit British Columbians,” Donaldson said in a press release.

Earlier this year, the NDP government introduced a new act, Bill 22, which was intended to address the heavy concentration of a dwindling forestry tenure supply among a handful of major forestry companies.

It was introduced at a time when B.C. has been hit by several permanent sawmill closures, and numerous curtailments.

Typically, when a sawmill shuts down, the Crown tenure – cutting rights – associated with it would be transferred to another sawmill owned by the same company that is still operating, or sold to some other company.

Bill 22 requires the forestry minister to approve any sales or transfers, and gives First Nations and affected communities more of a say in how tenure is disposed.

In the Conifex-Hampton case, Donaldson said the transfer will benefit Fort St. James, since it will allow the new owner to not only keep the sawmill in fort St. James operating, but also to expand it.

“As a condition of the transfer, Hampton has committed to build a new mill in Fort St. James that will be operational within 36 months of closing the transaction with Conifex,” Donaldson said.