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March 9, 2001

State Authorizes First Ocean Leasing Agreement

Honolulu - The State Board of Land and Natural Resources today authorized a 15-year ocean leasing agreement for the commercial production of fish in offshore sea cages. The ocean lease agreement between the State and Cates International, Inc. is the first of its kind in the state and in the nation.

The project will be located on 28 acres about two miles off Ewa Beach on Oahu. Up to four cages, anchored 40 feet below the surface, will be positioned on the site. The high-tech cages will be stocked with moi, a valuable local species, that has great export potential for Japan and the U.S. mainland.

"This historical agreement will provide a great boost to Hawaii's growing aquaculture industry," said Governor Cayetano. "Work on this project could very well lead to large-scale expansion of the local aquaculture industry, not only in raising moi, but also other premium market fish."

"This is a positive step in supplying the world's growing demand for seafood in a responsible manner that helps reduce the intense pressure on our precious and declining wild fish stocks," said Virginia Enos, Vice President of Cates International, Inc. "We hope to tap into the large local and international market demand for fish, while stimulating the growth of a new offshore industry in Hawaii."

The agreement is for 15 years, with an additional 10-year option. The rent will be based on a percentage of gross revenues to be determined by staff and appraisal. The agreement also allows Cates International a right of entry so preparations may begin immediately.

The Department of Land and Natural Resources (DLNR) has worked closely with the Department of Agriculture's Aquaculture Development Program (ADP) and the aquaculture industry in amending Chapter 190D of the Hawaii Revised Statutes (HRS) to allow commercial leases in the ocean and explore the ocean's potential.

"The State has a strong commitment to develop its aquaculture potentials and this first privately financed, commercial ocean lease will generate tax revenues and create jobs, as well as encourage land-based support businesses," said Gilbert Coloma-Agaran, Chairperson for the DLNR.

"This decision changes the face of Hawaii aquaculture by adding millions of acres of State marine waters to the 4 million acres of land for finding sites for sustainable fish farming," said John Corbin, Manager of ADP. "The additional research and development arising from this project will also help to support the industry as a whole."