Same Controversy, Different Company

Forest Service transfer of thinning contract draws praise, questions

The Four Forest Restoration Initiative plans to thin thousands of acres of forests, like is being done at this project near Flagstaff.

The Four Forest Restoration Initiative plans to thin thousands of acres of forests, like is being done at this project near Flagstaff. |

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The names have changed — but the plan’s the same.

The U.S. Forest Service on Friday announced it will transfer a contract to thin 300,000 acres of Arizona forests to Good Earth, an international company that operates thinning and logging projects in Africa that turn wood into electricity.

Good Earth CEO Jason Rosamond at a Web-broadcast press conference said the company will partner with another, still undisclosed company to manage the massive project intended to turn millions of tons of small trees and brush into wood products, saving taxpayers billions it would otherwise cost to thin fire-prone, badly overgrown forests.

“We are very excited to get started and make a difference,” said Rosamond. “As our key commitment is to people and communities, we will reinvest 50 percent of our profits to deliver everyday practical benefits at the local level with a focus on education and health care.”

The contract could yield as much as 800,000 tons of saw logs and 450,000 tons of biomass annually and yield hundreds of local jobs, if Good Earth can ever ramp up to the 30,000-acre annual target.

Some critics of the Forest Service’s handling of the largest forest restoration contract in history hailed the contract shift.

“If I put my Polly Anna hat on, it’s very hopeful,” said Gila County Supervisor Tommie Martin. “I hope they can perform. I hope this is the last step of this process. Let’s cut trees and build plants and get 300,000 acres cleaned at the end of a 10-year contract. I’m willing to give them the benefit of the doubt.”

The company has Chinese and Middle Eastern investment backing and Rosamond said it has the financing to build a mill in Winslow to build finger-jointed furniture. The company plans to build other mills and small facilities to turn small trees and wood scraps into electricity. Good Earth also is working on plans to produce natural gas, diesel and jet fuel from the wood it harvests.

The company for now has essentially the same, still-confidential business plan as Pioneer Forest Products, which sold Good Earth the contract awarded by the Forest Service more than a year ago. Pioneer has actually thinned only about 1,000 acres.

Good Earth will also hire former Forest Service Forester Marlin Johnson, who was the lightning rod for criticism of Pioneer. He said Pioneer decided to sell the contract to Good Earth after discovering banks won’t finance the mill and other facilities with only the contract for security.

Centers for Biological Diversity analyst Todd Schulke said he remains skeptical because the Forest Service insists key details remain confidential.

“My first reaction was that this must be a joke — you know — what do you get when you combine an Omani prince, a Chinese financier, and the Forest Service? The 4FRI contract,” said Schulke. “It’s still completely unclear how the contract will be implemented due to the lack of transparency. All we can hope for is that the Forest Service did a better job of evaluating GEP than they did Pioneer.”

Martin said Good Earth had to accept the Pioneer plan so the Forest Service could transfer the contract, but she assumes the new company will modify the plan as it moves forward. “They’re business people. They’re young. They’re aggressive. They’re smart. They actually act like business people.”

Key issues remained unclear at the end of the 90-minute press conference, including the speed with which the project can get back on schedule.

At one point, Forest Service officials said that it expects Good Earth to thin about 15,000 acres before the end of the current fiscal year next June. However, at another point they said the already-prepared thinning projects will take anywhere from six to 36 months to roll out. Most of the initial projects are in the Kaibab National Forest near the Grand Canyon.

Payson has lobbied hard to get the Forest Service to include the watershed of the Blue Ridge Reservoir in the 4FRI schedule. A fire could cause so much erosion that it would start to fill in the Blue Ridge Reservoir on which Pay­son’s future depends.

Forest Service officials said they expect Good Earth will thin another 25,000 acres in fiscal 2014 and then move forward at a pace of 30,000 to 35,000 acres annually. Pioneer was supposed to thin 30,000 acres in the current fiscal year, but the Forest Service granted a delay.

Rosamond declined to offer a firm timeline on building its Winslow plant. He said the company has financing lined up but he has no idea how long it will take government agencies to approve construction. Once the company gets approval, it could take another three years to build the plant.

In addition to producing furniture from the small trees, Rosamond said the company will try to produce synthetic gas from the brush and slash. Small scale projects have demonstrated you can produce hydrogen gas by heating wood scraps to 1,000 degrees centigrade in the absence of oxygen, removing impurities and then cooling the 99.9 percent pure hydrogen down. He said no one has yet undertaken the process on a scale large enough to produce cost-competitive fuel. However, he said the viability of the thinning project doesn’t rely on that element of the plan.

Rosamond said, “There are some other mills in the area we’ll be making investments in to upgrade their capacities. We’ll be talking to quite a number of mills. We’re planning on buying a number of pellet mills and locating them throughout the four forests.”

Rosamond added, “we’re very excited about the project. We’re a very open organization. We think this project can change the entire region and we hope it’s a model the entire country can look at.”

Deputy Southwest Regional Forester Gilbert Zepeda said only such a breakthrough approach on a massive scale has a chance to have an effect on the massive wildfires, tree deaths and bark beetle infestations that have already affected millions of acres.

The press conference left unresolved questions about the fate of the remaining old growth trees, which represent less than 3 percent of the trees in the forest. The group that devised the 4FRI approach favored strict limits on cutting trees larger than 16-inches. The Forest Service refused to accept a “diameter cap.”

Rosamond said his company doesn’t need to cut any of the big trees to make a profit. However, that issue remained the focal point of doubts about the process.

Schulke noted, “one point of concern is that we’ve heard they plan to invest in the Cooley Sawmill in Heber, which is designed to mill large trees. This certainly heightens concerns about large tree logging. I’m also going to be interested in seeing what the reaction will be from rural Arizona. The phrases ‘new world order, or one world government’ or even Agenda 21 keep running through my head. It’s hard to see how there’s complete support for a foreign interest coming in to take over this contract. Under the circumstances it’s hard not to be skeptical.”

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