New company takes on Meadow Creek Cedar license
A South Slocan company has assumed management of Meadow Creek Cedar’s forest license with plans to bring it back into compliance and eventually buy it.
Trevor Kanigan, general manager of a group of companies that includes Gold Island Forest Products, says their intention is to satisfy outstanding obligations to lift the license’s suspension.
“We’re in the process of getting that license running again,” he said in an interview. “We’re working with the Ministry of Forests to get it into a healthy state and a position to transfer ownership.”
Kanigan says the ministry has laid out criteria to remove the suspension, imposed in February for failure to meet forest-related obligations. He’s optimistic it will be at least partially restored soon, allowing limited-scale harvesting.
The agreement, giving the as-yet-unnamed company exclusive rights to manage the license, took effect October 15. However, Meadow Creek Cedar’s sawmill isn’t part of the deal.
“At this point, we don’t have any plans for the mill itself,” Kanigan says. “There’s a very good chance at some point next year after break up we’ll look at options for a sort yard.”
Kanigan is aware residents have “strong feelings” about logs leaving the Lardeau Valley, but says neither past nor present owners have been able to figure out the right log for the mill. Still, they’re open to working with another party.
“We’re not prepared to take on another processing facility ourselves, but there is enough fibre between this license and the Kaslo Community Forest to support another plant,” he says.
Kanigan expects their operation to consume 20 to 30 per cent of the timber volume from the license while the rest will be left to the open market.
He also said they are identifying the company’s numerous liabilities — which include over $100,000 owed in fines and back wages — and developing a business plan to address them. “We’re aware of the liabilities and prepared to look after them,” he said.
According to Kanigan, last May they approached Meadow Creek Cedar owner Dale Kooner with an offer to buy the mill and license. Kooner told them another party was interested in the land and buildings, so they restricted the negotiations to the forest license, and reached a lease-to-purchase agreement giving them full control pending the ownership transfer.
Kanigan says it also put the Ministry of Forests more at ease. “My take was the provincial government was worried about giving the license to someone else and having them say ‘Too much here, here’s your license back.’ The ministry needs a comfort level that the business plan is sound.”
Kanigan said district forest manager Garth Wiggill has been “very supportive” of their efforts: “This is very much a partnership to solve a big problem. There is genuine concern for the license from the ministry perspective.”
He says they’ve so far generated three or four positions in the Kaslo area and hired former Meadow Creek Cedar forester Rod Arnold as woodlands manager. “We’ve worked with Rod for nine of the 10 years we’ve been in business. So we have a long, strong relationship with him.”
Arnold is presently evaluating the company’s summer planting, which was supposed to be completed by mid-August. “The standard of planting might not be as high as we’d like,” Kanigan says, “but I know a good effort’s been made.”
Despite the many problems associated with the license, Kanigan says an assured local fibre source for their mill makes it worth the time and effort to sort out.
He stressed their company has a much different outlook than the present ownership.
“We’re local, we’ve been around for a decade, and are working with people who are comfortable with the credibility we’ve established,” he said. “Our intention is to make sure it is a healthy and successful license. We’re honoured to be part of bringing it back. We enjoy taking on unique challenges.”
Family-owned forestry firm succeeded in tough times
The new land and timber management company formed to manage Meadow Creek Cedar’s forest license is part of a group of affiliated South Slocan companies including Gold Island Forest Products, Selkirk Truss, and Sentinel Enterprises.
“We started our sawmill ten years ago in the spring,” says Kanigan. “We’ve taken our three-person business — myself, my dad, and my brother — and grown it into about 40 people.”
They have since added a dry kiln and truss plant and over the last year and a half vastly improved the sawmill, which produces specialty lumber.
In January, Kaslo’s mayor and council approached them about economic development opportunities in the area. “They were familiar with us and our history — they’d seen the success of our businesses through some tough times in the forest industry,” Kanigan says.
In April they met to discuss a project being developed by the Southern Interior Beetle Action Committee targeting the Kaslo/Meadow Creek corridor. That led them to look at the assets of Meadow Creek Cedar, from whom they used to buy fibre, both before and after the company’s sale to Surrey blueberry farm owner Dale Kooner in 2005.
“The license has been neglected,” Kanigan says. “It fits well with our sawmill. We want to create some stability in terms of log supply for our plant as well as opportunities to put people back to work in that area.”
Meadow Creek Cedar’s license is suspended due to a backlog of forestry-related obligations, but Kanigan says they plan to deal with them.
“We know the Meadow Creek license and mill are a mess. But based on the fact key people in that area have invited us and our good relationships with contractors, we’re looking forward to putting some stability back in those communities.”