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Landmark Forestry Agreement will Support Increased First Nations Participation in a Stronger Vancouver Island Economy and Vision For the Future

Press Release

October 23, 2023 – Victoria, British Columbia – The Tlowitsis, We Wai Kai, Wei Wai Kum and K’ómoks First Nations (the “Nations,” all member First Nations of the Nanwakolas Council), and Western Forest Products Inc. (TSX: WEF) (“Western”) have reached an agreement for the Nations to acquire a 34% interest from Western in a newly formed Limited Partnership (the “Partnership”) for $35.9 million (the “Agreement”). 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

The formation of the Partnership and acquisition by the Nations is subject to various closing conditions, including subdivision and tenure transfer approvals from the British Columbia Ministry of Forests. Western and the Nations are working towards closing the acquisition in the first quarter of 2024.

The Partnership will consist of certain assets and liabilities of Western’s Mid Island Forest Operation, including Block 2 of Tree Farm Licence 39. The operations of the new Partnership will cover approximately 157,000 hectares of forest land in the traditional territories of the Nations near the communities of Campbell River and Sayward on eastern Vancouver Island. The Partnership will manage an allowable annual cut of 904,540 cubic metres of timber and includes a long-term fibre agreement to support Western’s British Columbia coastal manufacturing operations.

Tlowitsis, We Wai Kai, Wei Wai Kum, and K’ómoks, who share significant areas of their respective territories, have been stewards of their forests for millennia. Nanwakolas Council assisted the four Nations in concluding the Agreement. “This is a good day for everyone on Vancouver Island and the central coast,” says Nanwakolas Council President Dallas Smith. “For far too long, the very people who are the reason there were healthy, abundant forests here prior to colonization were excluded from participation in their continued sustainable management and any ability to benefit from them. Today we celebrate a significant step forward on the pathway to sustainable, effective resource management of our forests for the benefit of future generations. I applaud the Nations for taking this step. I acknowledge Western for stepping up into the Partnership and thank BC for helping make this happen.”

“Negotiations by K’ómoks towards the acquisition of an economically viable forestry operation began in 2021,” says K’ómoks Chief Ken Price, who is a registered professional forester. “Historically, our people have always been involved in the forestry industry,” says Chief Price. “This forestry partnership agreement reflects not only a significant and meaningful incremental step forwards in our vision for economic wellbeing as a Nation, but our vision for a K’ómoks Treaty with the provincial and federal governments. K’ómoks would like to acknowledge Nanwakolas Council for its support of the Nations during the negotiations process, and our partners Tlowitsis, We Wai Kai, and Wei Wai Kum. As First Nations, we all look forward to taking our rightful place in forestry ownership and management in our territories.” The partnership achieves one of the “Winning Conditions” of reaching a K’ómoks Treaty and K’ómoks has put significant
resources into the work that has led up to this point. “We thank Western for their work to make the Partnership happen, and the support for our negotiations over the years from the Government of Canada and from the provincial government.”

“For Tlowitsis First Nation, this Agreement represents a new way forward that is deeply meaningful,” says Tlowitsis Chief John Smith. “The opportunity to be on the ground working on our territories is huge – to provide jobs for our young people, revenue to support our Nation, and simply a better way of doing business together, is priceless.”

“We Wai Kai is making significant investments in forestry, including the development and growth of our logging company, Way Key,” says We Wai Kai Chief Ronnie Chickite. “We appreciate the recognition by Western and British Columbia that we are an integral partner in the forest industry in our territory. This Agreement, and the Partnership it creates, is an important step forward for our Nation in participating meaningfully in the forest economy and taking back governance over our lands and resources.”

“When we speak of reconciliation, here is a living, practical example of reconciliation on the ground,” says Wei Wai Kum Chief Councillor Christopher Roberts. “We have raised concerns repeatedly over the generations about the immense value and wealth leaving our territory, with little to no benefit to our Nation. We have not been involved at the table in decision making. Finally, we took a stand four years ago that this must stop. We could not support the replacement of forest licences in our territory that don’t have commitments to address our concerns. But things are changing. This agreement is proof that it is possible to address multiple interests and generate positive outcomes for all people that call our territory home. Provincial support for this new partnership aligns with the Action Plan on the Declaration of the Rights of Indigenous Peoples Act. It aligns with our demonstrated ability to take back control of our territories and manage them successfully to ensure a better future for our people. I thank Western for sharing that vision of the future with us; and congratulate all of the partners and parties involved. It was hard work, but will have lasting positive impacts that will increase for generations to come.”

“The partnership is an excellent example of working together towards reconciliation,” said Premier David Eby. “Incremental Treaty Agreements build trust, and ensure First Nations in the treaty process and the entire community experience benefits sooner. This agreement means opportunities are on the way for business, First Nations members and communities on northern Vancouver Island, proving that a rising tide lifts all boats.”

“Tlowitsis, We Wai Kai, Wei Wai Kum and K’ómoks want to work innovatively and collaboratively with B.C. through the Incremental Treaty Agreements. They also wish to work with Western Forest Products, to have a lasting and positive impact on communities in north and central Vancouver Island that depend on the forestry industry,’ said Murray Rankin, Minister of Indigenous Relations and Reconciliation. “It is essential that these First Nations have a greater role in forestry, to advance their own economic goals and to advance

“Our agreement is another step forward in Western’s ongoing commitment to economic reconciliation and setting a solid foundation that benefits workers, communities and shareholders,” says Western’s President and CEO Steven Hofer. “Together with our partners, we are ushering in a new era of forestry in this province – one where everyone has the opportunity to fully participate and benefit.”

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