Forest & Carbon Update.

As many of you will have guessed we are still trying to implement a strategy to deal with the Carbon Credits. In our last correspondence we hinted that we were hoping to have some disclosure documents posted to you in the near future. Unfortunately due to taxation changes the proposal we had been working on for what seemed an eternity came to an abrupt holt just before Christmas 2011. This has meant a revisit as to what we are attempting to achieve and what way to achieve that result.

As you will also realise the Carbon Credits if not managed wisely could create a huge liability for the Landowner. As we have also pointed out in previous correspondence because of this liability we are unable just to give the investors (you) the carbon credits. However fortunately due to the nature of our forest estate i.e. having a mixed age profile, we are able to extract a percentage of the carbon credits from the pool of credits. We have done extensive modelling work and it shows that some 25% of the credits could be removed from the pool and possibly never need to be returned assuming certain assumptions are made.

I won’t go into the finer details as they are gone into depth in the disclosure documentation that is hopefully attached to this newsletter. If not you should be receiving the disclosure documents soon.

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