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Meadow Creek Forest Products pays off liabilities

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— image credit: Thinkstock/Getty Images

The district forest manager confirms Meadow Creek Forest Products has paid off $150,000 in liabilities incurred under a previous owner and “substantially met” a remediation order.

Garth Wiggill said in an interview Friday that a cancellation notice on the license has been rescinded and a suspension order imposed in 2012 lifted.

The Ministry of Forests has confirmed Dale Kooner transferred 100 per cent ownership of Meadow Creek Cedar to San Group of Surrey, which has renamed the operation Meadow Creek Forest Products.

“The new owners assume all past, current, and future liabilities associated with the forest license,” Wiggill said.

The transfer is under review by the provincial government, who assess the company’s financial standing and whether the sale creates any “undue competitive issues.” However, Wiggill said he doesn’t expect anything to affect the transfer.

San Group has paid off all outstanding debts to the crown that accumulated under Kooner’s ownership, including fines for failing to meet reforestation requirements.

A remediation order that led to the license’s suspension has also been addressed, although there are ongoing liabilities the new owners have committed to resolving, Wiggil said. “We feel that the areas that were required to be planted have been planted. We have been notified that it has been done, but continue checking.”

The company has permits to proceed with logging to feed its sawmill at Cooper Creek, which it acquired with the license. It had been closed for three years before restarting Friday for test runs using logs from private wood lots.

Wiggill, who met with the new owners last week, expects the mill will be sawing crown timber in a week to ten days.

“We’re cautiously optimistic,” he said. Although he felt the same way about a failed effort by Blue Ridge Timber to rehabilitate the license, he is “more optimistic this time. “The actions to date have been positive. They immediately settled the outstanding debts and hired new staff.”

Wiggill said he’ll be on site next week to meet with employees and discuss further plans to bring the license back into full compliance.

In addition to the silviculture backlog, there are road maintenance issues, including bridges, culverts, and drainage ditches that need repairs. Some key bridges, such as one across Howser Creek, have to be fixed before the company can access timber.

Under the license, Meadow Creek is permitted to cut 96,000 cubic meters per year, although that’s averaged over five years so that more or less wood can be harvested in a single year based on market conditions. However, any volume that isn’t harvested at the end of five years is lost to the company. The Meadow Creek license period ends in 2015 and has an unused volume of around 300,000 cubic meters.

Wiggill said while it is technically possible the company could cut that much wood over the next 18 months, it is “highly unlikely” given the amount of work involved.

He also said his office will continue to monitor the operation given its tumultuous recent history. “Obviously over the last five years our trust in that license was heavily eroded and we will need to establish trust and a working relationship with Meadow Creek [Forest Products],” he said.

“I’m looking forward to seeing that license go back to work and having people back to work supporting the Kaslo and northern Kootenay Lake economy. But we will have to monitor the license for the first couple of years.”

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