Forest Industry Report Supports a Brighter Future for Forest Companies in Alberta

May 7, 2009 Forest industry report supports a brighter future for forest companies in Alberta

Edmonton... The Government of Alberta outlined a number of actions it will take to help the province’s forest industry, forest communities and workforce benefit from greater flexibility, more complete use of wood fibre and opportunities in the emerging bio-economy.

The actions are outlined in government’s response to recommendations from the Forest Industry Sustainability Committee (FISC) report, Recommendations for Enhancing Alberta’s Business Model. Government is accepting and acting upon nearly 90 per cent of the FISC report’s recommendations. Key actions cover seven strategies: planning and management, tenure, strategic costs, infrastructure, energy and the bio-economy, diversification, and communication and branding. The accepted recommendations will support a more competitive business environment that makes the most of timber resources and helps diversify products and markets. They will align legislation, regulations and policy across government to clarify roles and responsibilities; support integrated planning; and lower strategic costs like transportation and energy that affect all industries. “Our response shows our commitment to forest communities, forestry workers and the forest industry. We’re going to stand by you,” said Ted Morton, Minister of Sustainable Resource Development. “Acting on these recommendations - along with maintaining existing supports for research, product development and workforce training - will help forestry remain a vital part of Alberta’s economy.” Six recommendations were not accepted for reasons of cost, restrictions under the Softwood Lumber Agreement, or the specifics of the recommendation did not apply to practice in Alberta. “The forest industry welcomes the release of this report,” said Brady Whittaker, Alberta Forest Products Association President and CEO. “We look forward to a time when, as a result of action on these recommendations, our province’s forest industry is once again economically robust - supporting the communities we operate in and sustaining the forests and environment that we rely on.” This is the final FISC report. In December 2007, the committee submitted Recommendations for Immediate Consideration that focused on short-term actions like workforce development and funding to maintain public roads. Government is acting on all the recommendations in that report. The Forest Industry Sustainability Committee was created in November 2007 - under the leadership of Chair Frank Oberle, MLA for Peace River, and with members from government and industry - to address the impacts on Alberta of a slower U.S. housing market that preceded the current global economic downturn. At least 50 Alberta communities look to the province’s forest industry for their livelihoods. Latest data from 2007 show Alberta’s forest industry generates more than $10 billion a year in revenues and provides 44,000 jobs. -30- Backgrounders: Summary of Recommendations; FISC Overview Media inquiries may be directed to: Duncan MacDonnell Communications, Sustainable Resource Development 780-427-4805 To call toll free within Alberta dial 310-0000. May 7, 2009

Summary of Forest Industry Sustainability Committee (FISC) Recommendations Strategy Main Recommendations (all supported in full, or in principle) Rationalize the planning and 1. Implement the Land-use Framework management system 2. Develop a land-use zoning system 3. Establish a comprehensive resource information system 4. Align legislation, regulation and policy 5. Main appropriate integration at all levels Bringing tenure into alignment 6. Align the tenure system with land use planning and management 7. Change tenure to rationalize fibre supply and reduce costs 8. Ensure relevancy of compensation guidelines and use 9. Enable realization of the carbon economy Managing strategic cost 10. Lead a provincial competitiveness strategy 11. Adopt a cross-ministry approach to resolve strategic cost issues 12. Encourage production efficiencies and modernization through competitive tax regimes 13. Revise Holding and Protection charges Addressing infrastructure needs 14. Make necessary resource road infrastructure investments 15. Seize opportunities to generate bio-products Capitalizing on Alberta’s 16. Capitalize on opportunities from bio-energy energy and the bio-economy interest Diversifying products and 17. Policy should support value maximization markets 18. Strengthen market intelligence and market access 19. Strengthen research and development investment Enhancing communication and 20. Cooperate to communicate the value of forest management branding The full report is available on the SRD website at http://srd.alberta.ca/forests/pdf/forest_industry_competitiveness_recommendations_Aug_2008.pdf Government’s response is available on the GoA website at http://alberta.ca/home/documents/FISC_document.pdf -30- Media inquiries may be directed to: Duncan MacDonnell Communications, Sustainable Resource Development 780-427-4805 To call toll free within Alberta dial 310-0000. May 7, 2009

Forest Industry Sustainability Committee (FISC) Membership Established November 2007: Frank Oberle, MLA for Peace River (Chair) Dr. Neil Brown, MLA for Calgary-Nose Hill Doug Griffiths, MLA for Battle River-Wainwright Wayne Clogg West Fraser Timber Company Limited Ken Higginbotham, Canfor Corporation Joe Constantino, Millar Western Forest Products Limited The committee was dissolved pending the 2008 provincial election. It was re-established in spring 2008, with Diana McQueen, MLA for Drayton Valley-Calmer and Doug Eliniski, MLA for Edmonton-Calder replacing former members Dr. Neil Brown and Doug Griffiths. FISC Reports The committee submitted an interim report, Recommendations for Immediate Consideration, in December 2007. Government accepted and implemented the 11 recommendations. Enhance provincial competitiveness Establish cost-accountability policy process Form transportation committee to address issues Lobby federal government on rail transport issues Ensure adequate maintenance for public roads Review municipal tax system for forest manufacturing facilities Financial management practices re: outstanding debt Enhance funding for FireSmart and mountain pine beetle projects Adopt provincial building standard endorsing wood use Government recognize woody biomass as carbon-neutral and qualify use of woody biomass as eligible for carbon credits Alberta to facilitate industry access to federal programs and funding for human resources assistance FISC submitted its final report, containing recommendations for a new forest business model for Alberta, to the SRD Minister in August 2008. The report contains 20 main recommendations, plus 29 subsidiary recommendations, for a total of 49 recommendations. -30- Media inquiries may be directed to: Duncan MacDonnell Communications, Sustainable Resource Development 780-427-4805 To call toll free within Alberta dial 310-0000. Alberta Government | Newsroom | Ministries Listing | News Releases | Top of Page |