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November 5, 1999 AFA CELEBRATES NEW INDUSTRIAL DIVERSITY
The Alaska Forest Association today praised the agreement between Louisiana Pacific Corporation and Gateway Forest Products that allows Gateway to take over LP’s Ward Cove sawmill and to operate a veneer plant in Ketchikan. According to executive director, Jack Phelps, "this agreement will help restore some of the diversity of products and log usage that Southeast Alaska lost when its two pulp mills ceased operations within the past 6 years. It also secures remaining industrial forest products jobs in Ketchikan and will add new manufacturing jobs to a region that has seen a dramatic employment decline in that sector."
"Both LP and Gateway have worked diligently on this agreement and they are to be applauded for making the tremendous effort to conclude a complex purchase arrangement that will benefit the local community and the regional economy," Phelps said. "While the future stability of timber offerings from the Tongass National Forest remains uncertain, Gateway Forest Products, as a small business concern, will be in a better position to compete for timber sales than LP was. Gateway’s willingness to wade into perilous waters to keep industrial jobs in Alaska is to be commended."
The presence of a veneer plant in Southeast Alaska will be good for the entire timber industry in the region, said Phelps. "The fact that this plant will focus on making veneer for the manufacture of laminated veneer lumber means that it will be converting logs from the lower end of the value spectrum," he stated. "This precisely addresses a major problem we’ve had since the last pulp mill went down. Those logs have been going to chips, now someone will make a higher value product from them. It gives other mills the option of selling veneer logs to Gateway and recovering more of their costs than they could from the chip value."