In This Issue:

• Message from the CEO
• Corporate News
• Aircrane
• Log Harvesting
• Safety Stats
• Mill Works
• Safety Bulletin
• Forestry News
• Environmental Mgmt. & Fire
• Information Systems
• Mill Report
• Calendar

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By Gary Collinge, ManagerLog Harvesting

Head down and go forward, that will be our focus as we move ahead in the last part of the 2nd quarter. The economics of our work scope changes so quickly by things we can't control, all we can do is be as consistent as possible. We are at a point in Cataract where we are finishing areas, which is never cost effective. Our patience will be tested for the next month as we finish up and move to our next projects.

The next two years of logging will have opportunities we will share with our partners within Mamook. TFL 54 presents economic change due to many variables - distance from market, species change, the log market and a camp situation for a large part of our volume, all resulting in higher cost and disappearing margins. Currently the pulp market is being impacted by recent mill closures which has a negative effect on all our budgets. We will have to focus very closely on improving sorts through better bucking and manufacturing if we are to compete. Quality Control in these times will be critical.

CLM will be the big producer in Cataract while conventional areas are being completed. The Kennedy Flats are moving some volume at this time as we cleanup 6000m3 of Fir pulp in the Lost Shoe blocks, and 2000m3 of salvage on West Main. Roads are almost complete in Cataract and the new road progress is good in Kennedy Flats and Stewardson. Our fallers have some minor cleanup in Cataract, and a little inventory ahead in Stewardson and Kennedy. Permits are coming for substantial volumes for 3rd and 4th quarter. The market will change because our production schedule has had enough delays this year; it is our turn.

We will have to hustle if we are to hit what markets remain. Industry is bracing for more changes around July 15th, stay tuned. Log and lumber sales are very soft.