Former Northern Peninsula mayor questions timber deal

January 30, 2019

By: The Working Forest Staff

CBC News — A former mayor and forestry operator on the of the Northern Peninsula, Nfld. has questions about Active Energy Company ‘s intentions.

Leander Pilgrim, who served as the mayor of Main Brook for over 30 years, says the U.K. company has no experience in forestry management and will ruin the traditional way of life in the area.

According to a report by CBC News, In late November, the province announced two five-year cutting permits for Timberlands International, a subsidiary of AEG.  “All they’re thinking about was the few extra jobs for eight to 10 years or whatever it’s going to create,” said Pilgrim. “We just can’t let it happen.” 

The deal gives the company rights to 500,000 cubic metres of forest in districts 17 and 18, which encompass the entire Northern Peninsula.  The company will also construct a wood pellet plant in Hawke’s Bay. But Pilgrim fears there will be no pellet plant and the government didn’t do its due diligence when researching the company’s past. 

Pilgrim hired a consultant at his own expense to look into the company’s history, sending his findings to key political figures. In a letter written to the government in December, he highlights AEG’s failures in the forestry industry.

The company’s interim financial results from the first six months of last year show the company hasn’t generated any revenue in two financial quarters, after the failure of its wood fibre operations in Ukraine. The company also failed timber deal in Northern Alberta.

In July 2014, the company formed a corporation with three Métis groups to commercialize 250,000 hectares of Métis land, but the Alberta government suspended that deal when the groups were found to have violated the province’s Métis Settlements Act by entering into a joint venture agreement with AEG without due diligence.

Pilgrim worries AEG is here just to line its pockets at the expense of nature.

“The forest plays a part in everything within our environment, like the temperatures of the rivers. Everything will be affected by this, what I calls a mess,” said Pilgrim. 

Fisheries and Land Resources Minister Gerry Byrne couldn’t disagree more. He said the provincial government has done all it can to mitigate the risk to the public and to taxpayers.

“The company is regulated by the U.K. stock exchange and their securities exchange commission. We sought and received a verification from the United Kingdom’s stock exchange that the company was in good standing.”

Byrne does acknowledge the deal isn’t fail-proof, but says no government money went to the company. And the agreement puts pressure on AEG to produce in the province.

“If they fail to harvest 40% of their existing allocation within the first 30 months, they start to lose access to forest resources.

 

See more HERE.

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