Forests Minister Doug Donaldson has approved the transfer of forest tenure from Conifex Timber Inc. to Hampton Lumber Mills, clearing the way for construction of a new sawmill in Fort St. James.
In a statement, Donaldson said he okayed the transfer on Friday, saying it is in the public interest.
"As a condition of the transfer, Hampton has committed to build a new mill in Fort St. James that will be operational within 36 months of closing the transaction with Conifex," Donaldson said.
"It is my expectation that Hampton will continue to work closely with First Nations to develop business and capacity-building arrangements and hire local workers. In addition, it must meet with the United Steelworkers' local, and continue discussions with Fort St. James Green Energy and local logging contractors."
The transfer consists of forest licence and associated road permits.
In June, the companies announced a $39-million deal that would see Oregon-based Hampton Lumber take over Conifex's operations in Fort St. Jame, subject to Donaldson's approval.
At the time, Hampton CEO Steve Zika said the company intends to build a new sawmill in Fort St. James and operated in partnership with area First Nations and community partners, "similar to a successful joint venture we have with the Burns Lake Native Development Corporation in the Burns Lake area."
Conifex's existing Fort St. James mill was shut down on May 13.
Nechako-Lakes MLA and Opposition forestry critic John Rustad called the development a positive step for the community but added it took the government took four months to make a decision even though Hampton made its intentions clear at the outset.
"I'm not sure what value was added to the discussion because this was the deal and the intent all along," he said. "If it locks in the commitment, I suppose that's a positive but having the uncertainty out there for months on end rather than getting to the deal and moving on is unfortunate."
A decision could have been made in a "matter of a month, maybe," he suggested.
Through Bill 22, passed in May, the forests minister has final say on whether a transfer of tenure can go ahead. Opposition Liberals have been highly critical of the measure, saying it creates additional bureaucracy that hinders companies ability to operate.
Rustad said the definition of public interest remains vague and subjective.
"In this case, it worked out but it may not always work out," he said.
In the statement, Donaldson said government had little say on such transactions prior to Bill 22.
"Now, those companies must be fully engaged with First Nations, workers and local governments before any tenure transfer would be considered. This is one sizeable step in making sure that the people who live near the forests are first in line to benefit from that resource," Donaldson said.
The deal remains subject to "remaining customary closing conditions," but is expected to be completed soon, the companies said in a statement.
