Meanwhile Steve Zika, CEO of Hampton Affiliates, a joint venture partner in Babine Forest Products and the Burns Lake Native Development Corporation, said in a news release Aug. 15 2012, that while agreeing with the SCTS report, it may not be enough to insure a secure timber supply adequate to justify the investment of building a new mill in the Lakes District.
“The decision to rebuild the sawmill and undertake the significant investment hinges on having a secure mid-term timber supply,” he said. “We appreciate the efforts of the committee in addressing the pine beetle situation and the attention that has been given to restoring the Burns Lake community. We realize that there are no easy answers to this crisis. We believe the Committee correctly identified through short-term actions how the Lakes TSA harvest levels can be set at 1,000,000 m3 indefinitely with no adverse effects on the environment,” Zika continued.
“However, immediately lowering the AAC from its current level of 2 million m3 without reducing harvest levels of non-Lakes TSA sawmills will consume much of the timber needed for mid-term timber supply security for the community of Burns Lake. As we pointed out in the testimony to the Committee previously, sawmills from adjoining TSAs have already consumed millions of cubic metres of logs from the Lakes TSA, saving the mid-term timber supply in their own districts. It is now time for them to return to their own mid-term timber supply,” said Zika.
Zika also added he felt the market would stay competitive if the government reduced the non-Lakes TSA sawmills. “The B.C. stumpage system is designed to calculate stumpage prices throughout the province even where there are not multiple mills in each TSA. For example the only sawmill in the Bulkley TSA is the West Fraser sawmill near Smithers. As the pine beetle damage reduces timber supply, sawmills from up and down Highway 16 will be scrambling for logs and there will be a very healthy demand for Lakes District logs and prices will likely go up. I am not sure what the B.C government may be willing to do in terms of allocating Lakes District timber? There will likely still be volume available for sale to the highest bidder in every TSA but if Babine’s only timber supply is far away, the freight cost of transporting logs long distance will make the sawmill uncompetitive.”
“I prefer to be optimistic and put our efforts into rebuilding the sawmill and not dwell on what might happen if the B.C. government is not accommodating. The Decker Lake sawmill could run some additional hours and hire a few more people if lumber markets improve dramatically but their product line is focused on specialty products which is a niche market and not easy to expand,” he said.
Zika concluded with a direction and time frame on future developments.
“We will continue to engage with the B. C. government on practical ways to ensure mid-term timber supply security without negatively affecting neighboring sawmills. Our intent is to make a decision on rebuilding the Babine sawmill in 30 days, based on the discussions and direction from the B. C. government.”
