US company gets forestry contract

Last updated 15:40 15/05/2014

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Wellington

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Cutting rights to 12 forests in the Wellington and Wairarapa region have been sold to a US-based company.

The Greater Wellington Regional Council made the decision to sell the rights to Resource Management Service LLC (RMS) at a closed meeting this morning.

While Greater Wellington will continue to own the land, RMS will hold cutting rights for the forests for at least 60 years.

It can be extended to 90 years halfway through the contract at the discretion of the council.

The 5430-hectare estate consists of nine blocks in the Wellington "metro" area and three in the Wairarapa.

They have previously been valued at $28.5 million.

A final price for today's sale will depend on a stock take of the forests on 30 June.

Proceeds would be used to repay debt incurred to fund the forests, which was expected to rise to about $35m by 2022.

GWRC chairwoman Fran Wilde said the council bought the forests a long time ago and they still carried debt.

''We've cleared the debt and got a little bit of money left over, but we still own the land,'' she said.

In a couple of forest harvest cycles a future council could decide what it wanted to do with the land, she said.

Harvest scheduling would be at the discretion of the buyer and was likely to driven by commercial considerations, she added.

''We hope they will put it through CentrePort,'' she said.

The council has retained the right to restrict logging at times of the week when the forests are used for recreational purposes, and to impose high health and safety standards, considering the recent history of the industry.

''There have been some unacceptable deaths, basically,'' she said.

Wilde said she understood cutting subcontractors would be hired locally. 

The 12 forests are: Akatarawa Saddle, Hukinga, Mangaroa, Maungakotukutuku, Pakuratahi East, Pakuratahi West, Puketiro, Valley View and Whakatikei in the Wellington "metro" area, and Hiwinui, Stoney Creek and Tauanui in the Wairarapa.

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- The Dominion Post

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