The vice President and chief forester of Interfor, Richard Slaco, said the pending purchase of two timber supply tenures from Springer Creek Forest Products in Slocan is a positive step forward for the company.
“We have an agreement to purchase but it hasn’t closed yet,” said Slaco, who was reached by telephone at his office in Delta. “The general view is that the market has definitely improved. Lumber prices in North America have increased to the point where the businesses are operating — after years of being in pretty tough circumstances — so that’s a very positive and encouraging development.”
Slaco said the Interfor business in Castlegar and Grand Forks is part of a turn-around story.
“Both those mills were purchased out of bankruptcy,” he said. “For us, it was being part of a transformation to the business itself and then being in a position to take advantage when the market improved.”
Slaco added the closing of the deal is an administrative process within the Ministry of Forests.
“So what we are waiting to receive from them is a notice to proceed with the transaction. Once we have that — which is the remaining hurdle and we are not anticipating any problem with that — then we would be in a position to actually close the deal and have the tenures.”
The decision to move forward on the tenure purchase was a combination of having the operations running more efficiently and a marketplace that is more favourable.
“I would say both of those things are a work in progress, but they’re definitely positive developments that have occurred,” said Slaco. “It will help with strengthening the log supply to service the Castlegar mill.”
When the tenures are complete they will add 174,000 cubic metres to the annual allowable cut for Interfor’s operations.
Slaco said it was too early in the process to comment on what the tenure purchase may mean for local workers or the local economy.