Kerr H FEMC2007

Modeling Needs of a Private Timberland Owner

Hamish Kerr, TimberWest Forest Corp., Suite 2300, 1005 West Georgia Street, P.O. Box 11101, Vancouver, BC, V6E 3P3, Canada, kerrh@timberwest.com

Private timberland is moving into the hands of financially driven owners who wish to maximize the value of the forest estate. In Canada companies such as TimberWest, Acadian Timber Income Fund and Island Timberlands are examples of companies who own timberland but have no core converting facilities. In the past timberland was owned primarily by large integrated companies to supply fibre to their converting facilities. Private timberland companies use models to analyze a wide variety of management scenario’s with the objective of increasing overall value. The management of timberland is becoming more complicated as constraints increase and more revenue streams become available. Constraints include maintaining water quality, wild life habitat and aesthetic considerations. Revenue streams include timber, conservation easements, real estate, coal bed gas or minerals plus the possibility of carbon credits. Value is maximized by successfully balancing long term revenue generation against increasingly complex constraints.