State peddling coastal towns to fish farms without local officials' knowledge

MOUNT DESERT, Dec. 7, 2022 - The State of Maine is shopping its coastal towns to industrial fish farms, without the knowledge of local officials.

In one case the state Department of Economic and Community Development began assisting a company in July without even knowing its identity, working only through a Seattle broker. After several months of email exchanges and at least one meeting with the broker, the state recommended sites in Searsport, Bucksport, Eastport and Wiscasset.

Here is a copy of the state recommendation obtained by the QSJ.

The town manager in Searsport was surprised to learn of the news when told by the QSJ. He said he would have told the state Nordic Aquafarms had considered Searsport and deemed it inappropriate for its land-based salmon farm and moved to Belfast.

Richard Rotella, director of community and economic development in Bucksport, was also kept in the dark. The site the state recommended in Buckport is next to another land-based fish farm owned by Whole Oceans, which has obtained all the necessary state and town permits but has yet to begin construction, leading to speculation about its financial wherewithal.

“Maybe they know something I don’t,” Rotella said.

He said he would have told the state siting two fish farms next to each other would not be a good idea.

“I don't think it's even possible, and good luck to two companies trying to find 500 employees each.”

(Companies often exaggerated employee numbers to get the state’s attention - and free work. This time it worked.)

The state’s knowledge about the sites seemed tenuous at best. In Wiscasset, it recommended the broker contact a regional authority about a property on Sheepscot River.

But the person listed as the contact, Mary Ellen Barnes of the Lincoln County Regional Planning Board, stated in an email she knew nothing about the proposal.

“Our organization has worked for years with the Town of Wiscasset on brownfields assessments and a clean-up grant for town-owned parcels on the larger site. The building -- circled in the illustration -- is privately-owned and we don't represent them. Apologies for this error. If I could speak on the owner's behalf, I would. But I'm not in a position to. 

“I've been in touch with DECD about this mix-up.”

Despite the misinformation, the state continued. On Aug. 10, 2022, Charlotte Mace, the state’s director of business development, wrote this email obtained by the QSJ to Divya Kapuria of Heartland LLC, the Seattle broker:

“In addition to the sites/communities listed in the attached presentation, please let us know if there are others you are interested in and we can facilitate communications and gather data you need.”

On Oct. 6, 2022, Heartland LLC upped the ante and essentially asked to put every town on the coast into play. Kapuria wrote:

“Towns you suggested, Wiscasset, Searsport, and Bucksport do not have access to the kind of water depths we need.

“We have had a chance to use GIS to filter some sites and areas along the coast of Maine that fit some of our criteria. Please see below cities/towns we are currently investigating.

For your reference, we have been developing our site characteristics list of the proposed project. Please see below:

• 40-50 acres of Land, could be assembled

• Proximity (within 3km) to ~50m water depths, closer the better

• Access to Sea Water, ideally on the coast

• Access to high power of 36MW

• Relatively flat

• Water temperature for operations: 12-14°C

• Level of production: 36,000 metric ton live weight capacity per year for total facility.

• Salmon Species: Atlantic Salmon

• System: Hybrid Flow-Through 2/3 recirculation and 1/3 new seawater

• Jobs:

• Construction Jobs: ~500 jobs during full buildout

• Permanent Jobs: ~300 at full operation

The towns listed were:

• Pleasant Point

• Perry

• Eastport

• Lubec

• Trescott Twp

• Cutler

• Machiasport

• Steuben

• Gouldsboro

• Winter Harbor

• Sorrento

• Hancock

• Bar Harbor

• Lamoine

• Trenton

• Surry

• Mount Desert

• Blue Hill

• Brooklin

• Tremont

• Southwest Harbor

• Deer Isle

• Stonington

• Sedgwick

• Brooksville

• Castine

• Stockton Springs

• Searsport

• Northport

• Lincolnville

• Camden

• Rockport

• Owls Head

• South Thomaston

• Saint George

• Cushing

• Friendship

• Bristol

• South Bristol

• Boothbay

• Boothbay Harbor

• Southport

• Georgetown

• Phippsburg

• Harpswell

• Cape Elizabeth

• Biddeford

Then the company asked the state for political assistance:

“I have read that there is some pushback and moratoriums on land-based aquaculture use. Which towns from the list above are in support of land-based aquaculture use? Are there any other towns that I should consider that might embrace this use that are not on the list?

“Overall, I am searching for local contacts at town and county level via the internet. I will reach out if there is a particularly interesting site that I can’t find any local contact for. The current hurdle for some sites is zoning. Aquaculture is a planning board approved use in most towns. Is there any flexibility to rezone Shoreland Zoning?” Kapuria wrote.

In response, Charlotte Mace referred the matter to Maine & Co., the state’s unofficial marketing arm which receives state funding and whose board members include the state’s economic development commissioner:

“Maine & Co. specializes in high-end economic development work, including site selection for the marine economy and land-based aquaculture sectors. So I have cc-ed Peter DelGreco and Ashley Pringle of Maine & Co. on this email.”

The state appeared not to have learned previous lessons.

On April 23, 2022, the QSJ wrote this article, https://theqsjournal.substack.com/p/how-a-norwegian-felon-managed-to, on how Peter DelGrego gave American Aquafarms the white glove treatment before learning six months later the founder and CEO had spent more than two years in a Norwegian prison. Last summer his assets were seized by a Norwegian court after an investor accused him of fraud in new charges.

Does the state have any any rules of engagement or protocols to safeguard its interests before blindly expending taxpayers’ money to cater to unidentified companies? Is there a minimum financial test, for instance?

The QSJ contacted Charlotte Mace on Wednesday. She said she would have someone from the commissioner’s office respond to my questions by the end of the week. No one responded. Nor did Divya Kapuria.

The state is working in its parallel universe at the same time existing fish farm initiatives are struggling to gain traction in Down East Coastal Maine.

One company, Kingfish Company announced a new CEO this week to rescue a free-falling stock on the Norwegian stock exchange.

Under the previous CEO, Ohad Maiman, son of one of the richest man in Israel, the company was ranked at the bottom quartile of performers for the fourth quarter of 2022; a percentile ranking of 10.3 out of 337 companies listed on the Oslo Bors Stock Exchange, according to published reports. The share price crashed by 18.66 percent in the forth quarter of 2022 to close at 9.68 (Norwegina Krone) on Dec. 30.

Maiman resigned in October.

But he was able to woo Maine DECD Commissioner Heather Johnson and win state approvals for a yellow tail land-based farm in Jonesport before his departure. The new CEO’s job is to raise money for that plant.

In Belfast, Nordic is fighting a Supreme Court appeal charging it did not have the necessary legal easements to run its pipes over tidal land. On July 6, the company abruptly changed leadership. Founder and USA CEO Erik Heim, the visionary behind the land-based farm, was replaced by Brenda Chandler, a Mainer who has served as chief financial officer of the USA subsidiary for the past three and a half years.

Heim announced on Facebook he and his wife, Executive Vice President Marianne Naess left the business. “It has been eight years since I founded the beginning of Nordic Aquafarms in our living room in Norway — a company to become one of the most profiled RAS [recirculating aquaculture system] companies in the world,” Heim wrote. “We were a pioneer in Norway on commercial salmon RAS.”

The one thing Whole Oceans, Nordic and Kingfish share in common: They all convinced the state to hand them operating permits which is their only currency at this point.

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