La-kwa sa muqw Forestry Partnership: ushering in a new era of Indigenous knowledge informing forestry planning and practices, and forestry prosperity for Nanwakolas Council First Nations.
Work on this agreement started a number of years ago. On Friday April 5, 2024, The La-kwa sa muqw Forestry Partnership (pronounced la-KWAH-sa-mook) was finalized, with a signing celebration held at the Kwanwatsi Big House at the We Wai Kum First Nation in Campbell River.
In October of 2023, the Tlowitsis, We Wai Kai, Wei Wai Kum and K’ómoks First Nations (four of the five member First Nations of the Nanwakolas Council) and Western Forest Products (WFP) reached an agreement for the Nations to acquire a 34% interest from WFP, in a newly formed Limited Partnership for $35.9 million. The Province of British Columbia helped to facilitate the Partnership through Incremental Treaty Agreements with the Nations, all of whom are in Stage 5 of the British Columbia Treaty Process.
How will this Forestry Partnership run?
The operations of this new partnership will cover about 157,000 hectares of forest land in the traditional territories of the Nations near the communities of Campbell River and Sayward.
The La-kwa sa muqw Forestry Partnership now manages the newly created Tree Farm License (TFL) 64 (formally Block 2 of TFL 39), located in the Salmon River area. The location was chosen given the geographic location for the participating Nations.
The partnership will manage an allowable annual cut of about 900,000 m3 of timber (the equivalent of about 900,000 45’ telephone poles), and also includes a long-term fibre agreement to support WFP’s British Columbia coastal manufacturing operations.
The partnership will manage the operations using infrastructure, employees and contractors transferred from WFP. Additional training and job opportunities may be available to the Nations’ members as contracts expire and employment positions open.
Leadership: The new partnership will have a three-person Board (two appointed by WFP, and one by the four First Nations collectively). There will also be an advisory group to the Board, with representatives from each of the Nations who will ensure the Board is fully informed on the interests of the Nations.
Collaboration: Western has already been partnering successfully with these First Nations under the Large Cultural Cedar (LCC) Protocol, supporting the Guardians undertaking monumental cedar surveys in the territories and providing LCCs to the Nations for cultural purposes. Western is committed to working with us to support continuing improvements to sustainable forestry management. We are all currently working on an Integrated Resource Management Plan to design the sustainable forest management regime for the new Tree Farm License (TFL).
This is the biggest acquisition of its kind on the coast, and a ground breaker for the Nations as well as for sustainable forestry management. It also spells a new level of economic opportunity and prosperity for Nations in the forestry sector.
The La-kwa sa muqw Forestry Partnership: The four Nanwakolas Council First Nations have acquired a 34% interest from Western Forest Products (WFP), for a cost of $35.9 million.
The four Nanwakolas Council Nations will hold the following shares of the 34% interest in WFP:
- Tlowitsis: 3.65% (11% of the total Forestry Partnership)
- We Wai Kai: 12.24% (36% of the total Forestry Partnership)
- Wei Wai Kum: 11.51% (34% of the total Forestry Partnership)
- K’ómoks: 6.58% (19% of the total Forestry Partnership)
The share split was determined by how much volume each nation needed, to achieve ~20% of the available volume with the Timber Supply Area (TSA).
Funding the Forestry Partnership:
- The Province of British Columbia provided $29.9 million in Incremental Treaty Agreements with the Nations towards the purchase price. All four Nations are in Stage 5 of the Treaty negotiation process.
- The Nations each contributed towards the remaining sum, according to the share of the partnership they will each own.
For K’ómoks, we were responsible for contributing a total of $6.957 million for our portion of the ownership:
- We received a $5.794 million advance from the Province through incremental Treaty funding that was specific to forestry. Essentially, the Province has advanced a portion of Treaty money allocated for economic development (this funding is called ‘Incremental Treaty dollars’). If Treaty goes through, we will have already spent this portion. However, if Treaty does not pass, we do not have to pay any of this money back.
- We contributed $1.162 million from our Own Source Revenue (OSR). This deal is seen as an incredibly positive investment for our Nation. The financial models show a 5-year average 8.7% return on our investment. It should only take about 8 years for the investment to pay for itself (including the Incremental Treaty dollars), and thereafter will generate significant financial benefit to K’ómoks for many years to come.
The La-kwa sa muqw Forestry Partnership is a huge win for the participating Nations of the Nanwakolas Council.
Economic benefits to K’ómoks:
- We are able to access Treaty incremental economic development funding before Treaty goes to ratification, and get that Treaty money working for us now
- High ROI: The deal projects a strong Return on our Investment (ROI) at an average of 8.7% over 5 years
- Low risk: Every business venture carries some risk. However, this investment provides more than financial returns: we get active participation with the largest forest company on the coast, we incorporate Indigenous planning perspectives in forestry, and we create opportunities for our members to have high paying jobs close to home.
Forestry stewardship benefits:
- We have a direct opportunity to work with WFP on planning forestry practices from an Indigenous lens, ensuring future benefits for KFN and other Nations
- We will also see planning from the perspective of a large company, which provides the benefits of economies of scale
- This partnership will provide our Guardians and other members the chance to understand forestry from a science and technology perspective, which can also provide a rewarding career
Background to the Partnership
Work on this agreement started a number of years ago. As we have been preparing ourselves for self-government, it became increasingly important to finalize negotiations to achieve the KFN forestry-related Treaty Winning Condition: we needed a total of 100,000 cubic metres of Allowable Annual Cut.
In 2021-2022, K’ómoks started forestry negotiation efforts with WFP to have an economically viable forestry operation. This started the journey for a new relationship between K’ómoks and WFP. During this time, K’ómoks gained knowledge and an understanding of what the capacity requirements will be post Treaty effective date, as well as the development of various draft agreements.
It was during these negotiations that the Chiefs from four of the five Nanwakolas Nations came together and decided to work collaboratively on this initiative. This collaboration of the four Nations was critical to the success of these negotiations and initiative: we are stronger together. Additionally, the funding enabled us to hire experienced negotiators and technical experts to undergo extensive research and ensure due diligence when negotiating.
In addition to our original objectives, K’ómoks was able to work collaboratively with We Wai Kum Nation, Wei Wai Kai Nation, and Tlowitis First Nation, for a common interest. This provided an opportunity for us to strengthen relationships with these other nations, particularly in the area of forestry.
Forestry Partnership FAQs
If this partnership was negotiated as part of Treaty, what if Treaty doesn’t go through? Do we have to pay back the money? What happens to the Partnership?
Essentially, the Province has advanced a portion of Treaty money allocated for economic development (this funding is called ‘Incremental Treaty dollars’). If Treaty goes through, we will have already spent this portion. However, if Treaty does not pass, we do not have to pay any of this money back, which was a strong consideration to participate.
Where did KFN’s funding for this deal come from?
For K’ómoks, we were responsible for contributing a total of $6.957 million to the full deal:
- We received a $5.794 million advance from the Province through incremental Treaty funding. Essentially, the Province has advanced a portion of Treaty money allocated for economic development (this funding is called ‘Incremental Treaty dollars’). If Treaty goes through, we will have already spent this portion. However, if Treaty does not pass, we do not have to pay any of this money back.
- We contributed $1.162 million from our Own Source Revenue (OSR). This deal is seen as an incredibly positive investment for our Nation. The financial models show a 5-year average 8.7% return on our investment. It should only take about 8 years for the investment to pay for itself (including the Incremental Treaty dollars), and thereafter will generate significant financial benefit to K’ómoks for many years to come.
Why is this a good deal for K’ómoks?
This deal is seen as an incredibly positive investment for our Nation. The financial models show a 5-year average 8.7% return on our investment. It should only take about 8 years for the investment to pay for itself (including the Incremental Treaty dollars), and thereafter will generate significant financial benefit to K’ómoks for many years to come. Additional benefits include:
- Indigenous knowledge applied to forestry planning
- Opportunity to understand large forest companies’ systems and structures
- Opportunities for members to work in the industry in roles other than just logging (accounting, GIS, Administration, Information Technology, and so on)
- Working from within a large company can facilitate the change in forestry practices we are looking for, and often can be easier than pushing from outside
