In This Issue:

• Message from the CEO
• Corporate News
• Aircrane
• Log Harvesting
• Mill Report
• Mill Works
• Forestry Engineering
• Environmental Mgmt. & Fire
• Safety Stats
• Information Systems
• Calendar

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• News Top

Forestry & Engineering

Forestry and Engineering is wrapping up an extremely busy 2008. We moved from Cataract to Clayoquot Sound, where we were able to achieve our target goal for timber under cutting permit. We were able stay current with our reforestation, road deactivation and other obligations from our past logging and get the survey work done to be ready for next year. Along the way we spent many hours in meetings with our First Nations partners and at times with the environmental organizations opposed to logging in Clayoquot Sound. We also ended up with media attention from all over North America including one day in mid summer, when our logging controversy in Clayoquot Sound with environmental groups was featured on the front page of the Vancouver Sun.

The economic downturn in the fall caused most of us to go from full speed through the summer to a full stop by the early November. Given the financial reality of our present situation, forestry and engineering must examine and receive approval for every expenditure we propose in the same manner as every other department in the Company.

Key things that we are working on over Christmas and into the new year are:

1. The Coulson Group spent over two million dollars on engineering and assessments in TFL 54 this summer. We need to ensure this data is finalized and is reliably stored to protect this large investment. Having very accurate, complete and accessible information is key to any internal or government audit or inspection of our logging areas and activities. Under the current approval regime, we must be able to show that we have shown due diligence in planning and setting up the activity or we may be liable for fines or suspensions. This is important everywhere but especially in TFL 54 where everything we do is closely scrutinized.
   
   
2. Zolie is completing the TFL 54 program in Clayoquot Sound for 2009 by getting approval for some final foreshore helicopter drop zones at Cypre River and Gunner Inlet. These approvals need to be in place by April 2009 when we hope to begin heli logging operations once again.
   
   
3. We are also required to do some additional long term planning for the next cutting periods in TFL 54. We have committed to adjust our long term plans as we pursue FSC certification. This is more difficult in TFL 54 than other areas because of the complex ownership arrangements with the TFL and the controversy with the environmental organizations.
   
   
4. Zolie and his engineers have been given approval for some initial work to identify the cutting areas for the next cutting program at Cataract and Toquart scheduled for 2010 and 2011. We had hoped to be well ahead with this work by early spring 2009 however, the economic crunch has us waiting to see if we are able to move forward. We need to finish the current program in TFL 54 before spending money on engineering new areas.
   
   
5. On the forestry side, Ron has advertised a significant planting program for the spring of 2009 and will have some additional survey work to do along with some final waste surveys on blocks we logged in 2007/08. We are hopeful that we will be able to complete this work and stay current with our commitments. Several large forest companies are unable to complete these obligations due to the lack of available cash.

In summary, there is plenty to do but the economic reality is that forestry and engineering will have to prioritize any expenditures along with all departments until we can return to steady operations. When that day comes we want to ensure that we will be in good shape and ready so that everyone in logging and milling can to get back to work.

Zolie, Ron and I wish everyone a Happy Christmas with your friends and families and may you have good fortune in 2009.