Headwaters, California Redwoods Grove Near Protection Deal?

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WORLDWIDE FOREST/BIODIVERSITY CAMPAIGN NEWS

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Forest Networking a Project of Ecological Enterprises

7/21/96

OVERVIEW & SOURCE by EE

Here is an update on the situation in the Headwaters old growth redwoods

area in California. We have followed the efforts to conserve this largest

remaining patch of redwoods that is not yet protected. It appears that

progress is being made in a debt for protection swap rather than

industrially harvesting this priceless biological resource. Following is a

photocopy of a UPI press article on the matter.

g.b.

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RELAYED TEXT STARTS HERE:

Maxxam near redwood pact: report

7/19/96

ARCATA, Calif., July 19 (UPI) -- Financier Charles Hurwitz is near a deal

with federal and state regulators that would swap thousand of acres of

public and private land for California's Headwaters Forest, a published

report said Friday.

Headwaters is a grove of ancient redwoods that Hurwitz's Maxxam has been

trying to log for the past six years. The Wall Street Journal, citing

unnamed people familiar with the pact, said final details have not yet been

worked out.

The complex agreement is likely to be worth hundreds of millions of dollars

to Maxxam, which bought the forest in 1986 through its junk-bond takeover

of Pacific Lumber in 1986. Hurwitz incurred the rage of environmentalists

by doubling the logging rate on Pacific Lumber lands to meet debt payments

and has been blocked from logging Headwaters by suits over endangered

species.

Houston-based company and regulators had no comment on the report but

investors took it seriously and stock of Maxxam gained $3.75 to $41.50 a

share in trading on the New York Stock Exchange.

Maxxam and the federal government agreed last week to a stay in a recent

Maxxam lawsuit accusing the government of violating the company's private

property rights by blocking logging in the Headwaters and other company

acreage. The stay expires in September.

The negotaiations could fall apart because of significant differences in

the value of Headwaters, with federal experts estimating $100 million to

$200 million and Hurwitz claiming $500 million.

The report said that in addition to swapping timberland, the government is

considering swapping such properties as Treasure Island in San Francisco

Bay. The land could be worth hundreds of millions if it is commercially

developed by Maxxam, which has interests in forests, real estate and

aluminum.

Headwaters, near the northwest corner of California, is prized by

environmentalists because of its value as a pristine habitat for rare

animals such as the spotted owl and marbled murrelet.

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