Conifex Timber Inc.
TSX VENTURE : CFF

Conifex Timber Inc.

April 18, 2012 16:05 ET

Conifex Announces BC Utilities Commission Approval of Power Purchase Agreement With BC Hydro and Appointment of Director

VANCOUVER, BRITISH COLUMBIA--(Marketwire - April 18, 2012) - Conifex Timber Inc. ("Conifex" or the "Company") (TSX VENTURE:CFF) announced today the British Columbia Utilities Commission ("BCUC") has approved its Electricity Purchase Agreement ("EPA") with BC Hydro as an energy supply contract. The Company completed its EPA and related Load Displacement Agreement ("LDA") with BC Hydro in June 2011.

Under the EPA, the Company will supply a minimum of approximately 200GWh of electrical energy annually to BC Hydro over a 20-year term from its bioenergy generation plant (the "Bioenergy Facility") which is currently in development adjacent to one of its sawmill complexes in Mackenzie B.C. Delivery of electricity to the BC Hydro grid is expected to commence in the third quarter of 2013. Revenues from the project to Conifex Timber Inc.'s bioenergy segment are expected to exceed $20 million annually when the Bioenergy Facility is operating at design capacity.

Under the LDA, the Company is required to deliver 30 GWh of electrical energy annually to provide for the energy requirements of Conifex's two Mackenzie sawmills over the term of the LDA. In exchange for the Company agreeing to make available such energy for its sawmills, BC Hydro will provide incentive funding to be utilized towards the completion of the Bioenergy Facility.

Mr. Ken Shields, Conifex President and Chairman, commented: "We are pleased to have received approval from the BCUC. With this important milestone in place, we can now settle our budget, construction and financing plans for the Bioenergy Facility on a priority basis and work towards the re-start of our Site I Mackenzie sawmill in 2013."

The Bioenergy Facility will create approximately 80 jobs during the 15-month construction period and over 20 new jobs upon completion. The expected energy generation of approximately 230 GWh of net energy per year is enough to power 24,000 BC homes annually.

Appointment of Michael Costello as Director

The Company is pleased to announce that Michael Costello has joined its Board of Directors. Mr. Costello has held a number of high profile executive and board positions during his distinguished career and currently serves as a director of the Ontario Power Authority; Vancouver Island Health Authority; BC Health Benefit Trust; and InTransit BC (Canada Line). Mr. Costello has also served as President and CEO of BC Transmission Corporation; President and CEO of BC Hydro and Power Authority; and Deputy Minister of Finance and Secretary to the Treasury Board for the Government of BC and the Government of Saskatchewan.

Mr. Costello previously served as Chair of the Canadian Electricity Association and Chair of the Energy Council of Canada.

Release of First Quarter 2012 Financial Results and Conference Call

The Company also announced today that it will release its first quarter 2012 financial results after markets close on Tuesday, May 22, 2012.

Conifex will host a conference call to discuss its first quarter 2012 financial and operating results on Wednesday, May 23, 2012 at 8:00 a.m. Pacific Time / 11:00 a.m. Eastern Time. To participate in the call, please dial: 416-695-6616 / 800-355-4959. The call will be available on instant replay access until June 30, 2012 by dialling 905-694-9451 or 800-408-3053 and entering participant pass code 8116753.

About Conifex Timber Inc.

Conifex and its subsidiaries' primary business currently includes timber harvesting, reforestation, forest management, and the manufacture, sale and distribution of its products. Conifex's lumber products are sold in the United States, Chinese, Canadian and Japanese markets. Upon completion of its bioenergy facility at Mackenzie, British Columbia, Conifex's business sectors will be expanded to include bioenergy.

Conifex's sawmill complex situated in Fort St. James, British Columbia was purchased in August 2008 and commenced operations on a one-shift basis in March 2009. Conifex's two-mill complex situated in Mackenzie, British Columbia was purchased in June 2010. One mill at Mackenzie started up on a one-shift basis in November 2010. Conifex added a second shift at Fort St. James and Mackenzie in late March 2011 and expects to operate at approximately 70% of capacity once the production ramp up phase from the second shifts is completed. On a combined basis, Conifex now owns sawmills having an annual lumber production capacity of approximately 745 million board feet on a two-shift basis. The sawmill complexes are supported by renewable forestry licences with an allowable annual cut of approximately 1.6 million cubic metres.

Forward-Looking Statements

Certain statements in this news release may constitute "forward-looking statements", including statements with respect to the private placements described herein. Forward-looking statements are statements that address or discuss activities, events or developments that the Company expects or anticipates may occur in the future. When used in this news release, words such as "estimates", "expects", "plans", "anticipates", "projects", "will", "believes", "intends" "should", "could", "may" and other similar terminology are intended to identify such forward-looking statements. Forward-looking statements reflect the current expectations and beliefs of the Company's management. Because forward-looking statements involve known and unknown risks, uncertainties and other factors, actual results, performance or achievements of the Company or industry may be materially different from those implied by such forward-looking statements. Forward-looking statements involve significant uncertainties, should not be read as a guarantee of future performance or results, and will not necessarily be an accurate indication of whether or not such results will be achieved. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements, including the ability to obtain all necessary regulatory and stock exchange approvals and those matters described in the Company's 2011 annual management's discussion and analysis, available on SEDAR at www.sedar.com. Accordingly, readers should exercise caution in relying upon forward-looking statements and the Company undertakes no obligation to publicly revise them to reflect subsequent events or circumstances, except as required by law.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Conifex Timber Inc. - Bioenergy Facility
    Antonio Madia
    Vice President, Corporate Development
    (250) 996-5461.

    Conifex Timber Inc. - Corporate Matters
    Yuri Lewis
    Chief Financial Officer
    (778) 331-8687