Pioneer Associates(PXD) won a contract allowing them to exploit an area of 300,000 acres of Arizona forests on Friday, May 19. The contract is part of an ambitious 20-year plan that aims to restore 2.4 million acres along the Mogollon Rim to reduce wildfire threats and create sustainable forest industries. It also has great chance of changing some industry conceptions, particularly the attitude towards small trees.
Small trees have never been considered particularly valuable and this has slowed progress of thinning projects on numerous occasions in the past. There just hasn’t been much interest from buyers for the harvested wood. But the Pioneer contract may change things significantly. The long-term agreement sets a lower price per acre, in exchange for building a major facility, where small trees can be processed. Pioneer has responded to this with a wood mill in Winslow, which it plans to be operational by autumn, 2013.
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