Module 7. How Do We Finance a Tenure Purchase?

Who Buys a Forest Licence?

Purchasing a forest licence is a joint decision between a First Nation and its economic development company. Both must agree on how the licence will be purchased and financed.

Planning for Financing

Discussing financing early is critical. Preparing a loan package can take months, requiring updated financial statements and a strong business plan. Approaching banks, First Nations, or raising own-source revenue is time-consuming but necessary.

A key early step is determining the quantity and value of timber within the tenure. While this assessment can be costly, it is often essential to securing financing. From there, Nations must be prepared for the significant capital investment needed to purchase and manage tenure.

Financing Options

Financing may come from one or a combination of the following:

• Own-source revenue from existing businesses
• Shareholder loans provided by the First Nation
• Bank financing through private lenders
• Provincial funding or government grants
• Business partnerships with forestry companies or investors

Additional Opportunities

Beyond traditional loans, Nations may also explore:

• Private sector loans from banks
• Revenue-sharing or equity arrangements with investors or forestry partners
• Non-profit or philanthropic grants linked to environmental outcomes (e.g., carbon sequestration, harvesting deferrals, habitat restoration)
• Government-to-government agreements, where revenue-sharing is negotiated between BC, Canada, and the First Nation
• Public sector grants supporting business planning, workforce development, and community engagement—available to First Nations, Tribal Councils, or wholly owned companies
• Partnerships with major licensees, where purchase and operating costs are repaid gradually through harvest revenue