Big Island land deal seen as paving way to power plant
Investors say timber is behind land deal; critics see power play
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HILO » Cambium Global Timberland Ltd. of Australia has bought the lease to 6,100 acres of Kamehameha Schools timber land on the Big Island, the company announced yesterday.
Timber will be sold to Tradewinds Forest Products LLC, which has been trying for seven years to build a Big Island mill to produce veneer, a component of plywood, and a power plant.
Forty percent of the land is native forest, "which will be conserved," Cambium said.
Tradewinds opponent Scott Enright said the native forest can be used as "carbon credits," an investment credit, but eucalyptus on the commercial land is not good for veneer and would serve instead as fuel for the power plant.
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HILO » An Australian investment fund has bought leasehold rights to 6,100 acres of Kamehameha Schools timber land on the Big Island, but it is unclear whether the move will boost a long-stalled building products industry planned by Tradewinds Forest Products LLC.
The announcement of the lease purchase by Cambium Global Timberland Ltd. was made yesterday from the tiny British Channel Island of Jersey.
The exact location of the lease was not given, but the land is believed to be in the Pahala area, about 50 miles southwest of Hilo* where Kamehameha Schools has extensive timber lands.
The purchase price was put at 3 million pounds sterling, or about $6 million.
Kamehameha Schools made no announcement and had no comment.
"Timber will be sold under a long-term supply agreement to Tradewinds Forest Products LLC," Cambium said.
However, 40 percent of the land, 2,400 acres, is native forest and will be conserved, the announcement said.
Tradewinds critic Scott Enright said part of the Cambium deal involves "carbon credits," a worldwide system in which companies can produce global-warming carbon dioxide in one area in exchange for avoiding carbon dioxide production in another area.
When Cambium was listed on the London and Channel Islands stock exchanges in March, the investment fund announced it would seek to "exploit environmental option values, such as the sale of carbon credits."
Enright and his wife, Susie Collins, live in Ookala, 30 miles north of Hilo. Their home is several hundred feet from a former sugar mill that Tradewinds plans to convert to a facility to slice eucalyptus logs into thin veneer for the off-island production of plywood or multilayered "engineered" lumber.
Enright, Collins, and many of their neighbors say the mill would be too noisy and polluting.
Tradewinds has been trying to establish a mill here for seven years. It is in a lengthy process of obtaining a clean-air permit for its mill from the state Department of Health. Company President Don Bryan could not be reached for comment.
The Cambium news release said the 6,100 acres were previously leased by Hancock Natural Resources Group. Enright said Hancock planned to turn eucalyptus into chips for fuel.
Hawaii's small acreage cannot compete with Brazil, for instance, where some plantations are 5 million acres, Enright said.
With years passing and Tradewinds unable to find financing for a mill, the company's real intent is to build a power plant fired by wood chips, Enright says. A major investor in Tradewinds is now Rockland Capital Energy Investments.
Hawaii Electric Light Co. announced last month that it signed an agreement with Tradewinds to buy from 2 to 3.6 megawatts when the mill and power plant are operational.
Wednesday, August 8, 2007
» The 6,100-acre tract of Kamehameha Schools land that will supply timber to a Big Island veneer mill is near Pahala, about 50 miles southwest of Hilo. A Page A6 article yesterday incorrectly suggested that the land was in the Hamakua area north of Hilo.