Plum Creek Timber (PCL) 10-K 25 Feb 10 2009 FY Annual report Financial data

Statement Of Income Alternative

Statement Of Income Alternative (USD $)
In Millions, except Per Share data	12 Months Ended Dec. 31, 2009	12 Months Ended Dec. 31, 2008	12 Months Ended Dec. 31, 2007
PLUM CREEK TIMBER CO INC
Revenues:
Timber	$545	$752	$782
Real Estate	486	432	402
Manufacturing	245	405	471
Other	18	25	20
Total Revenues	1,294	1,614	1,675
Cost of Goods Sold:
Timber	431	542	523
Real Estate	200	178	144
Manufacturing	257	435	454
Other	1	2	3
Total Cost of Goods Sold	889	1,157	1,124
Selling, General and Administrative	106	128	127
Total Costs and Expenses	995	1,285	1,251
Other Operating Income (Expense), net	0	(1)	0
Operating Income	299	328	424
Equity Earnings from Timberland Venture	55	15	0
Interest Expense, net:
Interest Expense (Debt Obligations to Unrelated Parties)	89	134	147
Interest Expense (Note Payable to Timberland Venture)	58	14	0
Interest Expense, net	147	148	147
Gain (Loss) on Extinguishment of Debt	(2)	11	0
Income before Income Taxes	205	206	277
Benefit for Income Taxes	(31)	(27)	(3)
Income from Continuing Operations	236	233	280
Gain on Sale of Properties, net of tax	0	0	2
Net Income	236	233	282
Per Share Amounts:
Income from Continuing Operations-Basic	1.45	1.37	1.6
Income from Continuing Operations-Diluted	1.44	1.37	1.6
Net Income per Share-Basic	1.45	1.37	1.61
Net Income per Share-Diluted	1.44	1.37	1.61
Dividends Declared-per Common Share Outstanding	1.68	1.68	1.68
Weighted-Average Number of Shares Outstanding
-Basic	163.3	170.3	174.5
-Diluted	163.4	170.7	175
PLUM CREEK TIMBER CO INC | Retained Earnings
Interest Expense, net:
Net Income	236	233	282
PLUM CREEK TIMBERLANDS L P
Revenues:
Timber	545	752	782
Real Estate	486	432	402
Manufacturing	245	405	471
Other	18	25	20
Total Revenues	1,294	1,614	1,675
Cost of Goods Sold:
Timber	431	542	523
Real Estate	200	178	144
Manufacturing	257	435	454
Other	1	2	3
Total Cost of Goods Sold	889	1,157	1,124
Selling, General and Administrative	106	128	127
Total Costs and Expenses	995	1,285	1,251
Other Operating Income (Expense), net	0	(1)	0
Operating Income	299	328	424
Equity Earnings from Timberland Venture	55	15	0
Interest Expense, net:
Interest Expense, net	89	134	147
Gain (Loss) on Extinguishment of Debt	(2)	11	0
Income before Income Taxes	263	220	277
Benefit for Income Taxes	(31)	(27)	(3)
Income from Continuing Operations	294	247	280
Gain on Sale of Properties, net of tax	0	0	2
Net Income before Allocation to Series T-1 Preferred Interest and Partners	294	247	282
Net Income Allocable to Series T-1 Preferred Interest	(58)	(14)	0
Net Income	236	233	282
PLUM CREEK TIMBERLANDS L P | Preferred Partnership Interest
Interest Expense, net:
Net Income Allocable to Series T-1 Preferred Interest	58	14
PLUM CREEK TIMBERLANDS L P | Partners' Capital
Interest Expense, net:
Net Income before Allocation to Series T-1 Preferred Interest and Partners	294	247
Net Income Allocable to Series T-1 Preferred Interest	(58)	(14)
Net Income			$282

Statement Of Financial Position

Statement Of Financial Position Classified (USD $)
In Millions	Dec. 31, 2009	Dec. 31, 2008
PLUM CREEK TIMBER CO INC
Current Assets:
Cash and Cash Equivalents	$299	$369
Accounts Receivable	24	22
Like-Kind Exchange Funds Held in Escrow	0	48
Taxes Receivable	15	23
Inventories	46	74
Deferred Tax Asset	6	11
Real Estate Development Properties	1	4
Assets Held for Sale	115	137
Other Current Assets	13	11
Assets, Current, Total	519	699
Timber and Timberlands, net	3,487	3,638
Property, Plant and Equipment, net	156	177
Equity Investment in Timberland Venture	201	199
Deferred Tax Asset	14	0
Investment in Grantor Trusts (at Fair Value)	33	25
Other Assets	38	42
Total Assets	4,448	4,780
Current Liabilities:
Current Portion of Long-Term Debt	55	158
Accounts Payable	32	35
Interest Payable	25	30
Wages Payable	20	28
Taxes Payable	14	18
Deferred Revenue	16	17
Other Current Liabilities	21	21
Liabilities, Current, Total	183	307
Long-Term Debt	1,625	1,793
Line of Credit	320	231
Note Payable to Timberland Venture	783	783
Deferred Tax Liability	0	4
Other Liabilities	71	90
Total Liabilities	2,982	3,208
Stockholders' Equity
Preferred stock, $0.01 par value, authorized shares-75.0, outstanding-none	0	0
Common stock, $0.01 par value, authorized shares-300.6, outstanding (net of Treasury Stock)-162.8 at December 31, 2009 and 166.0 at December 31, 2008	2	2
Additional Paid-In Capital	2,233	2,225
Retained Earnings	110	149
Treasury Stock, at cost, Common shares-24.8 at December 31, 2009 and 21.5 at December 31, 2008	(860)	(773)
Accumulated Other Comprehensive Income (Loss)	(19)	(31)
Total Stockholders' Equity	1,466	1,572
Total Liabilities and Stockholders' Equity	4,448	4,780
PLUM CREEK TIMBER CO INC | Common Stock
Stockholders' Equity
Total Stockholders' Equity	2	2
PLUM CREEK TIMBER CO INC | Paid-in Capital
Stockholders' Equity
Total Stockholders' Equity	2,233	2,225
PLUM CREEK TIMBER CO INC | Retained Earnings
Stockholders' Equity
Total Stockholders' Equity	110	149
PLUM CREEK TIMBER CO INC | Treasury Stock
Stockholders' Equity
Total Stockholders' Equity	(860)	(773)
PLUM CREEK TIMBER CO INC | Accumulated Other Comprehensive Income (Loss)
Stockholders' Equity
Total Stockholders' Equity	(19)	(31)
PLUM CREEK TIMBERLANDS L P
Current Assets:
Cash and Cash Equivalents	299	369
Accounts Receivable	24	22
Like-Kind Exchange Funds Held in Escrow	0	48
Taxes Receivable	15	23
Inventories	46	74
Deferred Tax Asset	6	11
Real Estate Development Properties	1	4
Assets Held for Sale	115	137
Other Current Assets	13	11
Assets, Current, Total	519	699
Timber and Timberlands, net	3,487	3,638
Property, Plant and Equipment, net	156	177
Equity Investment in Timberland Venture	201	199
Deferred Tax Asset	14	0
Investment in Grantor Trusts (at Fair Value)	34	26
Other Assets	38	42
Total Assets	4,449	4,781
Current Liabilities:
Current Portion of Long-Term Debt	55	158
Accounts Payable	32	35
Interest Payable	18	23
Wages Payable	20	28
Taxes Payable	14	18
Deferred Revenue	16	17
Other Current Liabilities	21	21
Liabilities, Current, Total	176	300
Long-Term Debt	1,625	1,793
Line of Credit	320	231
Deferred Tax Liability	0	4
Other Liabilities	72	91
Total Liabilities	2,193	2,419
Partnership Capital
Series T-1 Preferred Interest	790	790
Partners' Capital (Common Limited Partnership Interests)	1,466	1,572
Total Partnership Capital	2,256	2,362
Total Liabilities and Partnership Capital	4,449	4,781
PLUM CREEK TIMBERLANDS L P | Accumulated Other Comprehensive Income (Loss)
Partnership Capital
Total Partnership Capital	(19)	(31)
PLUM CREEK TIMBERLANDS L P | Preferred Partnership Interest
Partnership Capital
Total Partnership Capital	790	790
PLUM CREEK TIMBERLANDS L P | Partners' Capital
Partnership Capital
Total Partnership Capital	$1,485	$1,603

1_Statement Of Financial Positi

Statement Of Financial Position Classified (Parenthetical) (USD $)
In Millions	Dec. 31, 2009	Dec. 31, 2008
PLUM CREEK TIMBER CO INC
Preferred stock, par value	0.01	0.01
Preferred stock, authorized	75	75
Preferred stock, outstanding	0	0
Common stock, par value	0.01	0.01
Common stock, authorized	300.6	300.6
Common stock, outstanding (net of Treasury Stock)	162.8	166
Treasury Stock, Common shares	24.8	21.5
PLUM CREEK TIMBER CO INC | Common Stock
Common stock, outstanding (net of Treasury Stock)	162.8	166
PLUM CREEK TIMBERLANDS L P
Investment in Grantor Trusts, amounts at Fair Value	$33	$25

Statement Of Shareholders Equit

Statement Of Shareholders Equity And Other Comprehensive Income (USD $)
In Millions	PLUM CREEK TIMBER CO INC	PLUM CREEK TIMBER CO INC Common Stock	PLUM CREEK TIMBER CO INC Paid-in Capital	PLUM CREEK TIMBER CO INC Retained Earnings	PLUM CREEK TIMBER CO INC Treasury Stock	PLUM CREEK TIMBER CO INC Accumulated Other Comprehensive Income (Loss)	PLUM CREEK TIMBERLANDS L P	PLUM CREEK TIMBERLANDS L P Accumulated Other Comprehensive Income (Loss)	PLUM CREEK TIMBERLANDS L P Preferred Partnership Interest	PLUM CREEK TIMBERLANDS L P Partners' Capital
Beginning Balances at Dec. 31, 2006	$2,089	$2	$2,190	$214	($307)	($10)
Beginning Balances at Dec. 31, 2006							2,089	(10)	0	2,099
Beginning Balances (in shares) at Dec. 31, 2006		177.1
Net Income before Allocation to Series T-1 Preferred Interest and Partners							282
Net Income	282			282			282			282
Other Comprehensive Income:
Defined Benefit Plans, net of tax of $3 in 2009, $10 in 2008 and $4 in 2007	12					12	12	12
Total Comprehensive Income	294						294
Dividends	(294)			(294)
Stock Option Exercises (in shares)		0.3
Stock Option Exercises	8		8
Share-based Compensation	5		5
Common Stock Repurchased (in shares)		-5.1
Common Stock Repurchased	(202)				(202)
Tax Benefit from Stock Incentive Plans	1		1
Net Income Allocation to Series T-1 Preferred Interest							0
Distributions to Parent							(488)			(488)
Capital Contributions from Parent							6			6
Ending Balances (in shares) at Dec. 31, 2007		172.3
Ending Balances at Dec. 31, 2007	1,901	2	2,204	202	(509)	2
Ending Balances at Dec. 31, 2007							1,901	2	0	1,899
Net Income before Allocation to Series T-1 Preferred Interest and Partners							247			247
Net Income	233			233			233
Other Comprehensive Income:
Defined Benefit Plans, net of tax of $3 in 2009, $10 in 2008 and $4 in 2007	(29)					(29)	(29)	(29)
Unrealized Gains (Losses) on Available-for-Sale Securities, net of tax	(4)					(4)	(4)	(4)
Total Comprehensive Income	200						214
Dividends	(286)			(286)
Stock Option Exercises (in shares)		0.5
Stock Option Exercises	14		14
Shares Issued under Stock Incentive Plans		0.1
Share-based Compensation	5		5
Common Stock Repurchased (in shares)		-6.9
Common Stock Repurchased	(264)				(264)
Tax Benefit from Stock Incentive Plans	2		2
Net Income Allocation to Series T-1 Preferred Interest							(14)		14	(14)
Contribution for Series T-1 Preferred Interest							783		783
Distributions to Parent							(536)			(536)
Distributions for Series T-1 Preferred Interest							(7)		(7)
Capital Contributions from Parent							7			7
Ending Balances (in shares) at Dec. 31, 2008	166	166
Ending Balances at Dec. 31, 2008	1,572	2	2,225	149	(773)	(31)
Ending Balances at Dec. 31, 2008							2,362	(31)	790	1,603
Net Income before Allocation to Series T-1 Preferred Interest and Partners							294			294
Net Income	236			236			236
Other Comprehensive Income:
Defined Benefit Plans, net of tax of $3 in 2009, $10 in 2008 and $4 in 2007	7					7	7	7
Unrealized Gains (Losses) on Available-for-Sale Securities, net of tax	5					5	5	5
Total Comprehensive Income	248						306
Dividends	(275)			(275)
Shares Issued under Stock Incentive Plans		0.1
Shares Issued under Stock Incentive Plans	1		1
Share-based Compensation	7		7
Common Stock Repurchased (in shares)		-3.3
Common Stock Repurchased	(87)				(87)
Net Income Allocation to Series T-1 Preferred Interest							(58)		58	(58)
Distributions to Parent							(362)			(362)
Distributions for Series T-1 Preferred Interest							(58)		(58)
Capital Contributions from Parent							8			8
Ending Balances (in shares) at Dec. 31, 2009	162.8	162.8
Ending Balances at Dec. 31, 2009	1,466	2	2,233	110	(860)	(19)
Ending Balances at Dec. 31, 2009							$2,256	($19)	$790	$1,485

2_Statement Of Shareholders Equ

Statement Of Shareholders Equity And Other Comprehensive Income (Parenthetical) (USD $)
In Millions	PLUM CREEK TIMBER CO INC	PLUM CREEK TIMBERLANDS L P
Defined Benefit Plans, tax	$4	$4
Defined Benefit Plans, tax	10	10
Defined Benefit Plans, tax	$3	$3

Statement Of Cash Flows Indirec

Statement Of Cash Flows Indirect (USD $)
In Millions	12 Months Ended Dec. 31, 2009	12 Months Ended Dec. 31, 2008	12 Months Ended Dec. 31, 2007
PLUM CREEK TIMBER CO INC
Cash Flows From Operating Activities
Net Income	$236	$233	$282
Adjustments to Reconcile Net Income to Net Cash Provided By Operating Activities:
Depreciation, Depletion and Amortization (Includes $10 Lumber Impairment Loss in 2009 and 2008 and $4 Loss Related to Forest Fires in 2007)	109	135	134
Basis of Real Estate Sold	155	149	108
Equity Earnings from Timberland Venture	(55)	(15)	0
Distributions from Timberland Venture	53	0	0
Expenditures for Real Estate Development	(1)	(7)	(19)
Deferred Income Taxes	(14)	(10)	(9)
Gain on Sales of Properties and Other Assets	0	(3)	(2)
(Gain) Loss on Extinguishment of Debt	2	(11)	0
Deferred Revenue from Long-Term Gas Leases (Net of Amortization)	(6)	18	0
Pension Plan Contributions	(10)	(30)	0
Working Capital Changes Impacting Cash Flow:
Like-Kind Exchange Funds	48	(48)	0
Income Tax Receivable	8	(19)	0
Other Working Capital Changes	5	11	8
Other	10	17	15
Net Cash Provided By Operating Activities	540	420	517
Cash Flows From Investing Activities
Capital Expenditures (Excluding Timberland Acquisitions)	(61)	(70)	(93)
Timberlands Acquired	(1)	(119)	(174)
Investment in Timberland Venture	0	(9)	0
Purchases of Marketable Securities	(3)	(7)	0
Other	1	0	5
Net Cash Used In Investing Activities	(64)	(205)	(262)
Cash Flows From Financing Activities
Dividends	(275)	(286)	(294)
Borrowings on Line of Credit	1,073	1,506	2,795
Repayments on Line of Credit	(984)	(1,831)	(2,820)
Proceeds from Issuance of Long-Term Debt	0	250	350
Principal Payments and Retirement of Long-Term Debt	(273)	(258)	(125)
Note Payable to Timberland Venture	0	783	0
Proceeds from Stock Option Exercises	0	14	8
Acquisitions of Treasury Stock	(87)	(264)	(202)
Net Cash Used In Financing Activities	(546)	(86)	(288)
Increase (Decrease) In Cash and Cash Equivalents	(70)	129	(33)
Cash and Cash Equivalents:
Beginning of Year	369	240	273
End of Year	299	369	240
Cash Paid (Received) During the Year for:
Interest-Debt Obligations to Unrelated Parties	93	143	150
Interest-Note Payable to Timberland Venture	58	7	0
Interest	151	150	150
Income Taxes-Net	(18)	1	5
Non-Cash Investing Activity:
Contribution of Timber and Timberlands to Timberland Venture	0	174	0
PLUM CREEK TIMBER CO INC | Retained Earnings
Cash Flows From Operating Activities
Net Income	236	233	282
PLUM CREEK TIMBERLANDS L P
Cash Flows From Operating Activities
Net Income before Allocation to Preferred Partnership Interest and Partners	294	247	282
Net Income	236	233	282
Adjustments to Reconcile Net Income to Net Cash Provided By Operating Activities:
Depreciation, Depletion and Amortization (Includes $10 Lumber Impairment Loss in 2009 and 2008 and $4 Loss Related to Forest Fires in 2007)	109	135	134
Basis of Real Estate Sold	155	149	108
Equity Earnings from Timberland Venture	(55)	(15)	0
Distributions from Timberland Venture	53	0	0
Expenditures for Real Estate Development	(1)	(7)	(19)
Deferred Income Taxes	(14)	(10)	(9)
Gain on Sales of Properties and Other Assets	0	(3)	(2)
(Gain) Loss on Extinguishment of Debt	2	(11)	0
Deferred Revenue from Long-Term Gas Leases (Net of Amortization)	(6)	18	0
Pension Plan Contributions	(10)	(30)	0
Working Capital Changes Impacting Cash Flow:
Like-Kind Exchange Funds	48	(48)	0
Income Tax Receivable	8	(19)	0
Other Working Capital Changes	5	4	8
Other	10	17	15
Net Cash Provided By Operating Activities	598	427	517
Cash Flows From Investing Activities
Capital Expenditures (Excluding Timberland Acquisitions)	(61)	(70)	(93)
Timberlands Acquired	(1)	(119)	(174)
Investment in Timberland Venture	0	(9)	0
Purchases of Marketable Securities	(3)	(7)	0
Other	1	0	5
Net Cash Used In Investing Activities	(64)	(205)	(262)
Cash Flows From Financing Activities
Cash Distributions to Partners	(362)	(536)	(488)
Cash Distributions for Series T-1 Preferred Interest	(58)	(7)	0
Contribution for Series T-1 Preferred Interest	0	783	0
Borrowings on Line of Credit	1,073	1,506	2,795
Repayments on Line of Credit	(984)	(1,831)	(2,820)
Proceeds from Issuance of Long-Term Debt	0	250	350
Principal Payments and Retirement of Long-Term Debt	(273)	(258)	(125)
Net Cash Used In Financing Activities	(604)	(93)	(288)
Increase (Decrease) In Cash and Cash Equivalents	(70)	129	(33)
Cash and Cash Equivalents:
Beginning of Year	369	240	273
End of Year	299	369	240
Cash Paid (Received) During the Year for:
Interest	93	143	150
Income Taxes-Net	(18)	1	5
Non-Cash Investing Activity:
Contribution of Timber and Timberlands to Timberland Venture	0	174	0
PLUM CREEK TIMBERLANDS L P | Partners' Capital
Cash Flows From Operating Activities
Net Income before Allocation to Preferred Partnership Interest and Partners	294	247
Net Income			$282

3_Statement Of Cash Flows Indir

Statement Of Cash Flows Indirect (Parenthetical) (USD $)
In Millions	12 Months Ended Dec. 31, 2009	12 Months Ended Dec. 31, 2008	12 Months Ended Dec. 31, 2007
PLUM CREEK TIMBER CO INC
Depreciation, Depletion and Amortization, Lumber Impairment Loss	$10	$10	$0
Depreciation, Depletion and Amortization, Loss Related to Forest Fires	0	0	4
PLUM CREEK TIMBERLANDS L P
Depreciation, Depletion and Amortization, Lumber Impairment Loss	10	10	0
Depreciation, Depletion and Amortization, Loss Related to Forest Fires	$0	$0	$4

ACCOUNTING POLICIES

ACCOUNTING POLICIES
	12 Months Ended Dec. 31, 2009 USD / shares
PLUM CREEK TIMBER CO INC
ACCOUNTING POLICIES	NOTE 1. ACCOUNTING POLICIES General. Plum Creek Timber Company, Inc. (Plum Creek, the company, we, us, or our), a Delaware Corporation, is a real estate investment trust, or REIT, for federal income tax purposes. Plum Creek Timber Company, Inc. is also the parent company of its wholly-owned subsidiary Plum Creek Timberlands, L.P. (the Partnership), a Delaware Limited Partnership. At December31, 2009, the company owned and managed approximately 7million acres of timberlands in the Northwest, Southern and Northeast United States, and owned eight wood product conversion facilities in the Northwest United States (two of which have been curtailed). Included in the 7million acres are about 1.35million acres of higher value timberlands, which are expected to be sold and/or developed over the next fifteen years for recreational, conservation or residential purposes. In addition, the company has approximately 250,000 acres of non-strategic timberlands, which are expected to be sold over the next five years. In the meantime, all of our timberlands continue to be managed productively in our business of growing and selling timber. Basis of Presentation. The consolidated financial statements of the company include the accounts of Plum Creek Timber Company, Inc. and its subsidiaries. Intercompany transactions and accounts have been eliminated in consolidation. All transactions are denominated in United States dollars. Use of Estimates. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Customer Concentrations. Revenues from the companys largest customer accounted for 7%, 8% and 9% of total revenues in 2009, 2008 and 2007, respectively. If adverse market conditions for wood products were to continue or worsen, the loss of this customer could have a significant effect on the companys results of operations. Product Concentrations. Sales of the companys timber and wood products are dependent upon the economic conditions of the housing, repair and remodeling, industrial, and pulp and paper industries. Sales of the companys timberlands are dependent upon the general economic conditions in the United States, interest rates and the availability of buyer financing from financial institutions, not-for-profit organizations and government sources. As a result of these product concentrations, continued or worsening conditions in these markets could have a significant impact on the companys results of operations. Revenue Recognition. Timber sales revenues are recognized when legal ownership and the risk of loss transfers to the purchaser and the quantity sold is determinable. The company sells timber under delivered log agreements as well as through sales of standing timber (or stumpage). For delivered sales, revenue, which includes amounts billed for shipping and handling (log
PLUM CREEK TIMBERLANDS L P
ACCOUNTING POLICIES	NOTE 1. ACCOUNTING POLICIES General. Plum Creek Timberlands, L.P. is a Delaware Limited Partnership and a wholly-owned subsidiary of Plum Creek Timber Company, Inc. (Parent), a Delaware Corporation and a real estate investment trust, or REIT. References herein to the Operating Partnership, we, us, or our relate to Plum Creek Timberlands, L.P. and all of its wholly-owned consolidated subsidiaries; references to Plum Creek or Parent relate to Plum Creek Timber Company, Inc. and all of its wholly-owned consolidated subsidiaries. At December31, 2009, the Operating Partnership owned and managed approximately 7million acres of timberlands in the Northwest, Southern and Northeast United States, and owned eight wood product conversion facilities in the Northwest United States (two of which have been curtailed). Included in the 7million acres are about 1.35million acres of higher value timberlands, which are expected to be sold and/or developed over the next fifteen years for recreational, conservation or residential purposes. In addition, the Operating Partnership has approximately 250,000 acres of non-strategic timberlands, which are expected to be sold over the next five years. In the meantime, these timberlands continue to be managed productively in our business of growing and selling timber. Basis of Presentation. The consolidated financial statements of the Operating Partnership include the accounts of Plum Creek Timberlands, L.P. and its subsidiaries. The Operating Partnership is 100% owned by Plum Creek. Plum Creek has no assets or liabilities other than its ownership interests in Plum Creek Timberlands, L.P. and Plum Creek Ventures I, LLC (PC Ventures), a 100% owned subsidiary of Plum Creek. The Parent has no operations other than its investment in these subsidiaries and transactions in its own equity, such as the issuance and/or repurchase of common stock and the receipt of proceeds from stock option exercises. Intercompany transactions and accounts between Plum Creek Timberlands, L.P. and its subsidiaries have been eliminated in consolidation. All transactions are denominated in United States dollars. Use of Estimates. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Customer Concentrations. Revenues from the Operating Partnerships largest customer accounted for 7%, 8% and 9% of total revenues in 2009, 2008 and 2007, respectively. If adverse market conditions for wood products were to continue or worsen, the loss of this customer could have a significant effect on the Operating Partnerships results of operations. Product Concentrations. Sales of the Operating Partnerships timber and wood products are dependent upon the economic conditions of the housing, repair and remodeling, industrial, and pulp and paper industries. Sales of the Operating Part

EARNINGS PER SHARE

EARNINGS PER SHARE (PLUM CREEK TIMBER CO INC)
	12 Months Ended Dec. 31, 2009 USD / shares
EARNINGS PER SHARE	NOTE 2. EARNINGS PER SHARE The following table sets forth the reconciliation of basic and diluted earnings per share for the years ended December31 (in millions, except per share amounts): 2009 2008 2007 Income from Continuing Operations $ 236 $ 233 $ 280 Gain on Sale of Properties, net of tax 2 Net Income Available to Common Stockholders $ 236 $ 233 $ 282 Denominator for Basic Earnings per Share 163.3 170.3 174.5 Effect of Dilutive SecuritiesStock Options 0.1 0.3 0.4 Effect of Dilutive SecuritiesRestricted Stock, Restricted Stock Units, Dividend Equivalents, and Value Management Plan 0.1 0.1 Denominator for Diluted Earnings per ShareAdjusted for Dilutive Securities 163.4 170.7 175.0 Per Share AmountsBasic: Income from Continuing Operations $ 1.45 $ 1.37 $ 1.60 Gain on Sale of Properties, net of tax $ $ $ 0.01 Net Income $ 1.45 $ 1.37 $ 1.61 Per Share AmountsDiluted: Income from Continuing Operations $ 1.44 $ 1.37 $ 1.60 Gain on Sale of Properties, net of tax $ $ $ 0.01 Net Income $ 1.44 $ 1.37 $ 1.61 Antidilutive options were excluded for certain periods from the computation of diluted earnings per share because the options exercise prices were greater than the average market price of the common shares. Antidilutive options were as follows for the years ended December31 (shares in millions): 2009 2008 2007 Number of Options 2.2 0.9 0.5 Range of Exercise Prices $30.70to$43.23 $35.54to$43.23 $35.54to$43.23 Expiration on or before February 2019 May 2018 July 2017

INVENTORIES

INVENTORIES
	12 Months Ended Dec. 31, 2009 USD / shares
PLUM CREEK TIMBER CO INC
INVENTORIES	NOTE 3. INVENTORIES Inventories, accounted for using the lower of average cost or market, consisted of the following (in millions): December31, 2009 December31, 2008 Raw Materials (primarily logs) $ 9 $ 23 Work-In-Process 1 3 Finished Goods 23 36 33 62 Supplies 13 12 Total $ 46 $ 74 The above amounts reflect write-downs of inventories to net realizable value of $7 million at December31, 2008. The company also recorded a loss of $9 million at December31, 2008, related to commitments to purchase logs from unrelated third parties for our manufacturing facilities. The combined loss of $16 million during 2008 was included in Cost of Goods Sold for Manufacturing in the Consolidated Statements of Income.
PLUM CREEK TIMBERLANDS L P
INVENTORIES	NOTE 2. INVENTORIES Inventories, accounted for using the lower of average cost or market, consisted of the following (in millions): December31, 2009 December31, 2008 Raw Materials (primarily logs) $ 9 $ 23 Work-In-Process 1 3 Finished Goods 23 36 33 62 Supplies 13 12 Total $ 46 $ 74 The above amounts reflect write-downs of inventories to net realizable value of $7 million at December31, 2008. The Operating Partnership also recorded a loss of $9 million at December31, 2008, related to commitments to purchase logs from unrelated third parties for our manufacturing facilities. The combined loss of $16 million during 2008 was included in Cost of Goods Sold for Manufacturing in the Consolidated Statements of Income.

TIMBER AND TIMBERLANDS

TIMBER AND TIMBERLANDS
	12 Months Ended Dec. 31, 2009 USD / shares
PLUM CREEK TIMBER CO INC
TIMBER AND TIMBERLANDS	NOTE 4. TIMBER AND TIMBERLANDS Timber and Timberlands consisted of the following (in millions): December31, 2009 December31, 2008 Timber and Logging Roads, net $ 2,307 $ 2,443 Timberlands 1,180 1,195 Timber and Timberlands, net $ 3,487 $ 3,638 During 2009, the company completed a non-cash exchange of real estate in which the Real Estate Segment recognized revenue of $25 million which represents the fair value of the lands received. No operating income was recognized in the transaction as the book value of the timberlands disposed approximated the exchange value of $25 million. Timberland dispositions during 2009, excluding the non-cash exchange, were approximately 297,000 acres, of which 248,000 acres were located in the Northern Resources Segment and 49,000 acres were located in the Southern Resources Segment. Included in the 248,000 acres of Northern Resources timberland dispositions are approximately 112,000 acres sold in Montana for proceeds of $250 million and operating income of $162 million from the second phase of a multi-period contract. During 2008, the company negotiated the sale of 310,000 acres in Montana for $489 million, to be closed in three phases. For the year ended December31, 2008, the Real Estate Segment includes revenue of $150 million and operating income of $74 million related to the closing of the first phase. The third and final phase is expected to close in 2010. In connection with this transaction, we also entered into a fiber supply agreement for these timberlands (for up to 15 years) at market-based prices to supply our manufacturing facilities. During 2008, Plum Creek acquired approximately 147,000 acres of timberlands primarily located in Georgia, Vermont and Oregon for $119 million. These purchases were financed primarily by using the funds from tax-deferred exchanges and our line of credit, and have been accounted for as asset acquisitions. Timberland dispositions during 2008 were approximately 314,000 acres, of which 223,000 acres were located in the Northern Resources Segment and 91,000 acres were located in the Southern Resources Segment. Included in the 223,000 acres of Northern Resources timberland dispositions is approximately 130,000 acres sold in Montana during 2008 for proceeds of $150 million which is part of the 310,000 acre multi-period contract. Additionally during 2008, approximately 454,000 acres located in the Southern Resources Segment were contributed to a timberland venture in exchange for an equity interest. See Note 16 of the Notes to Consolidated Financial Statements. The companys Real Estate Segment revenue consists of sales of higher and better use timberlands and sales of non-strategic timberland. Occasionally, non-strategic timberlands are sold at a loss. Each potential real estate sale is evaluated for a possible impairment in accordance with the accounting for long-lived assets classified as held for sale. At December31, 2009, the book basis of real estate held for sale was $115 million and was $137 million as of December31, 2008. Impairment losses are included in Cost of Go
PLUM CREEK TIMBERLANDS L P
TIMBER AND TIMBERLANDS	NOTE 3. TIMBER AND TIMBERLANDS Timber and Timberlands consisted of the following (in millions): December31, 2009 December31, 2008 Timber and Logging Roads, net $ 2,307 $ 2,443 Timberlands 1,180 1,195 Timber and Timberlands, net $ 3,487 $ 3,638 During 2009, the Operating Partnership completed a non-cash exchange of real estate in which the Real Estate Segment recognized revenue of $25 million which represents the fair value of the lands received. No operating income was recognized in the transaction as the book value of the timberlands disposed approximated the exchange value of $25 million. Timberland dispositions during 2009, excluding the non-cash exchange, were approximately 297,000 acres, of which 248,000 acres were located in the Northern Resources Segment and 49,000 acres were located in the Southern Resources Segment. Included in the 248,000 acres of Northern Resources timberland dispositions are approximately 112,000 acres sold in Montana for proceeds of $250 million and operating income of $162 million from the second phase of a multi-period contract. During 2008, the Operating Partnership negotiated the sale of 310,000 acres in Montana for $489 million, to be closed in three phases. For the year ended December31, 2008, the Real Estate Segment includes revenue of $150 million and operating income of $74 million related to the closing of the first phase. The third and final phase is expected to close in 2010. In connection with this transaction, we also entered into a fiber supply agreement for these timberlands (for up to 15 years) at market-based prices to supply our manufacturing facilities. During 2008, the Operating Partnership acquired approximately 147,000 acres of timberlands primarily located in Georgia, Vermont and Oregon for $119 million. These purchases were financed primarily by using the funds from tax-deferred exchanges and our line of credit, and have been accounted for as asset acquisitions. Timberland dispositions during 2008 were approximately 314,000 acres, of which 223,000 acres were located in the Northern Resources Segment and 91,000 acres were located in the Southern Resources Segment. Included in the 223,000 acres of Northern Resources timberland dispositions is approximately 130,000 acres sold in Montana during 2008 for proceeds of $150 million which is part of the 310,000 acre multi-period contract. Additionally during 2008, approximately 454,000 acres located in the Southern Resources Segment were contributed to a timberland venture in exchange for an equity interest. See Note 13 of the Notes to Consolidated Financial Statements. The Operating Partnerships Real Estate Segment revenue consists of sales of higher and better use timberlands and sales of non-strategic timberland. Occasionally, non-strategic timberlands are sold at a loss. Each potential real estate sale is evaluated for a possible impairment in accordance with the accounting for long-lived assets classified as held for sale. At December31, 2009, the book basis of real estate held for sale was $115 million and was $137 million as of December31, 2008.

PROPERTY, PLANT AND EQUIPMENT

PROPERTY, PLANT AND EQUIPMENT
	12 Months Ended Dec. 31, 2009 USD / shares
PLUM CREEK TIMBER CO INC
PROPERTY, PLANT AND EQUIPMENT	NOTE 5. PROPERTY, PLANT AND EQUIPMENT Property, Plant and Equipment consisted of the following (in millions): December31, 2009 December31, 2008 Land, Buildings and Improvements $ 86 $ 92 Machinery and Equipment 308 310 394 402 Accumulated Depreciation (238 ) (225 ) Property, Plant and Equipment, net $ 156 $ 177 During the first quarter of 2009, the company conducted an analysis to rationalize and consolidate its lumber operations. The analysis was performed by the company due to the significant and sustained decline in lumber demand along with the companys expectations for continued weakness in this business. As a result of this analysis, the company concluded that certain of its lumber manufacturing assets were impaired. Consequently, during the first quarter of 2009, the company recorded an impairment charge of $10 million related to these lumber manufacturing assets. During the second quarter of 2008, the company recorded an impairment charge of $10 million related to its lumber manufacturing assets. The impairment losses are reflected in the operating income of the Manufactured Products Segment and included in Cost of Goods Sold for Manufacturing in the Consolidated Statements of Income. The fair value of the impaired assets was determined by the company using expected future cash flows discounted at a risk-adjusted rate of interest. See Note 10 of the Notes to Consolidated Financial Statements.
PLUM CREEK TIMBERLANDS L P
PROPERTY, PLANT AND EQUIPMENT	NOTE 4. PROPERTY, PLANT AND EQUIPMENT Property, Plant and Equipment consisted of the following (in millions): December31, 2009 December31, 2008 Land, Buildings and Improvements $ 86 $ 92 Machinery and Equipment 308 310 394 402 Accumulated Depreciation (238 ) (225 ) Property, Plant and Equipment, net $ 156 $ 177 During the first quarter of 2009, the Operating Partnership conducted an analysis to rationalize and consolidate its lumber operations. The analysis was performed by the Operating Partnership due to the significant and sustained decline in lumber demand along with the Operating Partnerships expectations for continued weakness in this business. As a result of this analysis, the Operating Partnership concluded that certain of its lumber manufacturing assets were impaired. Consequently, during the first quarter of 2009, the Operating Partnership recorded an impairment charge of $10 million related to these lumber manufacturing assets. During the second quarter of 2008, the Operating Partnership recorded an impairment charge of $10 million related to its lumber manufacturing assets. The impairment losses are reflected in the operating income of the Manufactured Products Segment and included in Cost of Goods Sold for Manufacturing in the Consolidated Statements of Income. The fair value of the impaired assets was determined by the Operating Partnership using expected future cash flows discounted at a risk-adjusted rate of interest. See Note 7 of the Notes to Consolidated Financial Statements.

INCOME TAXES

INCOME TAXES
	12 Months Ended Dec. 31, 2009 USD / shares
PLUM CREEK TIMBER CO INC
INCOME TAXES	NOTE 6. INCOME TAXES Plum Creek has elected to be taxed as a REIT under sections 856-860 of the United States Internal Revenue Code. A REIT generally does not pay corporate-level income tax if it distributes 100% of its taxable income to shareholders and satisfies other organizational and operational requirements as set forth in the Internal Revenue Code. If a company fails to qualify as a REIT in any taxable year, it will be subject to federal income taxes at regular corporate rates (including any applicable alternative minimum tax) and may not be able to qualify as a REIT for four subsequent taxable years. Plum Creek operates as a REIT through various wholly-owned subsidiaries and a joint venture partnership. The activities of the operating partnerships and joint venture partnership consist primarily of sales of standing timber under pay-as-cut sales contracts. The book basis of the REITs assets and liabilities exceeds its tax basis by approximately $2.0 billion at December31, 2009. Plum Creek conducts certain activities through various wholly-owned taxable REIT subsidiaries, which are subject to corporate-level income tax. These activities include the companys manufacturing operations, the harvesting and sale of logs, and the development and/or sale of some of the companys higher and better use timberlands. Plum Creeks wholly-owned taxable REIT subsidiaries file a consolidated federal income tax return. As a consequence of the October6, 2001 merger with The Timber Company, which involved merging a taxable entity into a nontaxable entity, Plum Creek has generally been subject to corporate-level tax (built-in gains tax) when the company makes a taxable disposition of certain property acquired in the merger. The built-in gains tax applies to gains recognized within the ten-year period following the merger date from such asset sales to the extent that the fair value of the property exceeds its tax basis at the merger date. Built-in gains tax is generally not payable on dispositions of property to the extent the proceeds from such dispositions are reinvested in qualifying like-kind replacement property. The built-in gains tax does not apply to income generated from the sale of timber. Following the merger with The Timber Company, Plum Creek wrote-off all of The Timber Companys deferred income tax liability related to timber and timberlands except for $11 million. The $11 million deferred income tax liability related to the book-tax basis difference of timber and timberlands that were expected to be sold, and subject to, the built-in gains tax during the ten-year period ending October6, 2011. Prior to January1, 2009, the $11 million deferred income tax liability was reduced by $5 million due to a remeasurement of the amount of deferred income taxes needed and by $2 million due to the payment or accrual of tax in connection with sales of timberlands subject to the built-in gains tax. In connection with the enactment of the American Recovery and Reinvestment Act of 2009, deferred taxes associated with timber and timberlands were reduced by an additional $3 million, resulting in the recognition of a $3 million deferred income tax benef
PLUM CREEK TIMBERLANDS L P
INCOME TAXES	NOTE 5. INCOME TAXES Plum Creek Timberlands, L.P. is a wholly-owned limited partnership and therefore, not subject to income tax. Plum Creek Timberlands, L.P.s taxable income is allocated 100% to its parent, Plum Creek Timber Company, Inc., which has elected to be taxed as a REIT under sections 856-860 of the United States Internal Revenue Code. A REIT generally does not pay corporate-level income tax if it distributes 100% of its taxable income to shareholders and satisfies other organizational and operational requirements as set forth in the Internal Revenue Code. However, the Operating Partnership conducts certain non-REIT activities through various wholly-owned taxable REIT subsidiaries, which are subject to corporate-level income tax. These activities include our manufacturing operations, the harvesting and sale of logs, and the development and/or sale of some higher and better use timberlands. The Operating Partnerships tax provision includes the tax expense and/or benefit associated with Plum Creeks wholly-owned taxable REIT subsidiaries, as well as any tax expense and/or benefit incurred by the REIT. The effective tax rate for the Operating Partnership is lower than the federal corporate statutory rate primarily due to Plum Creeks status as a REIT. If Plum Creek fails to qualify as a REIT in any taxable year, it will be subject to federal income taxes at regular corporate rates (including any applicable alternative minimum tax) and may not be able to qualify as a REIT for four subsequent taxable years. The book basis of Plum Creeks assets and liabilities exceeds its tax basis by approximately $2.0 billion at December31, 2009. Plum Creeks wholly-owned taxable REIT subsidiaries file a consolidated federal income tax return. As a consequence of the October6, 2001 merger with The Timber Company, which involved merging a taxable entity into a nontaxable entity, Plum Creek has generally been subject to corporate-level tax (built-in gains tax) when Plum Creek makes a taxable disposition of certain property acquired in the merger. The built-in gains tax applies to gains recognized within the ten-year period following the merger date from such asset sales to the extent that the fair value of the property exceeds its tax basis at the merger date. Built-in gains tax is generally not payable on dispositions of property to the extent the proceeds from such dispositions are reinvested in qualifying like-kind replacement property. The built-in gains tax does not apply to income generated from the sale of timber. Following the merger with The Timber Company, Plum Creek wrote-off all of The Timber Companys deferred income tax liability related to timber and timberlands except for $11 million. The $11 million deferred income tax liability related to the book-tax basis difference of timber and timberlands that were expected to be sold, and subject to, the built-in gains tax during the ten-year period ending October6, 2011. Prior to January1, 2009, the $11 million deferred income tax liability was reduced by $5 million due to a remeasurement of the amount of deferred income taxes needed and by $2 million due to the payment or accrual of tax in

REIT DISCLOSURES

REIT DISCLOSURES (PLUM CREEK TIMBER CO INC)
	12 Months Ended Dec. 31, 2009 USD / shares
REIT DISCLOSURES	NOTE 7. REIT DISCLOSURES Plum Creek has elected to be taxed as a REIT under sections 856-860 of the United States Internal Revenue Code. For the years 2009, 2008 and 2007, Plum Creek elected to designate all distributions as long-term capital gain dividends. As of and for the years ended December31, 2009, 2008, and 2007, Plum Creek has distributed all of its taxable income. The table below summarizes the historical tax character of distributions to Plum Creek shareholders for the years ended December31 (amounts per share): 2009 2008 2007 Capital Gain Dividend $ 1.68 $ 1.68 $ 1.68 Non-Taxable Return of Capital Total Distributions $ 1.68 $ 1.68 $ 1.68

BORROWINGS

BORROWINGS
	12 Months Ended Dec. 31, 2009 USD / shares
PLUM CREEK TIMBER CO INC
BORROWINGS	NOTE 8. BORROWINGS All of our borrowings, except the Note Payable to Timberland Venture, are made by Plum Creek Timberlands, L.P., the companys wholly-owned operating partnership (the Partnership). Outstanding borrowings consist of the following (in millions): December31, 2009 December31, 2008 Senior Notes due 2011, 7.83% $ 49 $ 98 Term Credit Agreement due 2012, 0.73% at 12/31/09, based on LIBOR plus 0.45%. 350 350 Term Credit Agreement due 2012, 1.28% at 12/31/09, based on LIBOR plus 1.00%. 250 250 Senior Notes due 2013, mature serially 2010 to 2013, 5.48% to 6.18% 227 227 Senior Notes due 2013, mature serially 2011 to 2013, 7.66% to 7.76%, less unamortized discount of $1.6 at 12/31/09, effective rates of 7.93% to 8.05% 286 359 Senior Notes due 2015, 5.875% less unamortized discount of $4.9 at 12/31/09, effective rate of 6.10% 453 458 Senior Notes due 2016, mature serially 2010 to 2016, 7.97% to 8.05% 65 99 Line of Credit maturing 2011, 0.63% at 12/31/09, based on LIBOR plus 0.425%. 320 231 Note Payable to Timberland Venture due 2018, 7.375% 783 783 Senior Notes due 2009, 8.73% plus unamortized premium of $1.0 at 12/31/08, effective rate of 7.10% 110 Total Long-Term Debt 2,783 2,965 Less:Current Portion (55 ) (158 ) Long-Term Portion $ 2,728 $ 2,807 Line of Credit. The company has a $750 million revolving line of credit agreement that matures in June 2011. As of December31, 2009, the weighted-average interest rate for the borrowings on the line of credit was 0.63%. The interest rate on the line of credit is based on LIBOR plus 0.425%. This rate can range from LIBOR plus 0.27% to LIBOR plus 1% depending on our debt ratings. Subject to customary covenants, the line of credit allows for borrowings from time to time up to $750 million, including up to $100 million of standby letters of credit. Borrowings on the line of credit fluctuate daily based on cash needs. As of December31, 2009, we had $320 million of borrowings and $11million of standby letters of credit outstanding; $419 million remained available for borrowing under our line of credit. As of January4, 2010, $295 million of the borrowings under our line of credit was repaid. Term Credit Agreements. The company has two term credit agreements under which there is $250 million and $350 million outstanding. These borrowings mature in 2012 and are subject to covenants that are substantially the same as those of the revolving line of credit. The agreements allow for prepayment of the borrowings at any time prior to the maturity date without premium or penalty. As of December31, 2009, the interest rate for the $250 million term credit agreement was 1.28%. The interest rate on this term credit agreement is based on LIBOR plus 1.00%. This rate can range from LIBOR plus 0.5% to LIBOR plus 1.5% depending on our debt ratings. As of December31, 2009, the interest rate for the $350 million term credit agreement was 0.7
PLUM CREEK TIMBERLANDS L P
BORROWINGS	NOTE 6. BORROWINGS Outstanding borrowings consist of the following (in millions): December31, 2009 December31, 2008 Senior Notes due 2011, 7.83% $ 49 $ 98 Term Credit Agreement due 2012, 0.73% at 12/31/09, based on LIBOR plus 0.45%. 350 350 Term Credit Agreement due 2012, 1.28% at 12/31/09, based on LIBOR plus 1.00%. 250 250 Senior Notes due 2013, mature serially 2010 to 2013, 5.48% to 6.18% 227 227 Senior Notes due 2013, mature serially 2011 to 2013, 7.66% to 7.76%, less unamortized discount of $1.6 at 12/31/09, effective rates of 7.93% to 8.05% 286 359 Senior Notes due 2015, 5.875% less unamortized discount of $4.9 at 12/31/09, effective rate of 6.10% 453 458 Senior Notes due 2016, mature serially 2010 to 2016, 7.97% to 8.05% 65 99 Line of Credit maturing 2011, 0.63% at 12/31/09, based on LIBOR plus 0.425%. 320 231 Senior Notes due 2009, 8.73% plus unamortized premium of $1.0 at 12/31/08, effective rate of 7.10% 110 Total Long-Term Debt 2,000 2,182 Less:Current Portion (55 ) (158 ) Long-Term Portion $ 1,945 $ 2,024 Line of Credit. The Operating Partnership has a $750 million revolving line of credit agreement that matures in June 2011. As of December31, 2009, the weighted-average interest rate for the borrowings on the line of credit was 0.63%. The interest rate on the line of credit is based on LIBOR plus 0.425%. This rate can range from LIBOR plus 0.27% to LIBOR plus 1% depending on our debt ratings. Subject to customary covenants, the line of credit allows for borrowings from time to time up to $750 million, including up to $100 million of standby letters of credit. Borrowings on the line of credit fluctuate daily based on cash needs. As of December31, 2009, we had $320 million of borrowings and $11million of standby letters of credit outstanding; $419 million remained available for borrowing under our line of credit. As of January4, 2010, $295 million of the borrowings under our line of credit was repaid. Term Credit Agreements. The Operating Partnership has two term credit agreements under which there is $250 million and $350 million outstanding. These borrowings mature in 2012 and are subject to covenants that are substantially the same as those of the revolving line of credit. The agreements allow for prepayment of the borrowings at any time prior to the maturity date without premium or penalty. As of December31, 2009, the interest rate for the $250 million term credit agreement was 1.28%. The interest rate on this term credit agreement is based on LIBOR plus 1.00%. This rate can range from LIBOR plus 0.5% to LIBOR plus 1.5% depending on our debt ratings. As of December31, 2009, the interest rate for the $350 million term credit agreement was 0.73%. The interest rate on this term credit agreement is based on LIBOR plus 0.45%. This rate can range from LIBOR plus 0.3% to LIBOR plus 1.15% depending on our debt ratings. Senior Notes. The Operating Partnership has outstanding Senior Notes wit

RESTRICTED NET ASSETS

RESTRICTED NET ASSETS (PLUM CREEK TIMBER CO INC)
	12 Months Ended Dec. 31, 2009 USD / shares
RESTRICTED NET ASSETS	NOTE 9. RESTRICTED NET ASSETS Plum Creek Timber Company, Inc. is the direct parent company of Plum Creek Timberlands, LP (Partnership) and Plum Creek Ventures I, LLC (PC Ventures), and the indirect parent of all the subsidiaries of the consolidated group. Plum Creek Timber Company, Inc. has no assets or liabilities other than its ownership interest in the Partnership and PC Ventures. During 2008, PC Ventures borrowed $783 million from an entity in which the Partnership has an equity interest. See Notes 8, 16 and 17 of the Notes to Consolidated Financial Statements. Interest payments for this borrowing are funded by distributions to PC Ventures directly from the Partnership. PC Ventures has no other activities. The Partnership is restricted from transferring assets and funds in the form of loans, advances or cash dividends to Plum Creek Timber Company, Inc. under the terms of the term credit agreements, senior notes and line of credit (see Note 8 of the Notes to Consolidated Financial Statements). Subject to certain restrictions, the Partnership can make loans or advances to Plum Creek Timber Company, Inc. Based on these provisions, at December31, 2009, all of the Partnerships Cash and Cash Equivalents ($299million) are available to make restricted payments. At December31, 2009, the Partnership and its consolidated subsidiaries had net assets of $1,466million of which $1,167million were restricted from being transferred by the Partnership to Plum Creek Timber Company, Inc. Presented below is the condensed unconsolidated financial information for Plum Creek Timber Company, Inc. as of December31, 2009 and 2008 and for each of the years in the three-year period ended December31, 2009. The ownership of the Partnership and PC Ventures is presented using the equity method of accounting. As of December31, 2009 and 2008, the undistributed earnings included in retained earnings from an entity accounted for by the equity method were $17 million and $15 million, respectively. Plum Creek Timber Company, Inc. Condensed Unconsolidated Balance Sheet Data (In Millions) December31, 2009 December31, 2008 Assets Investment in Consolidated Subsidiaries $ 1,466 $ 1,572 Total Assets $ 1,466 $ 1,572 Liabilities Total Liabilities $ $ Commitments and Contingencies Stockholders Equity Common Stock 2 2 Additional Paid-In Capital 2,233 2,225 Retained Earnings and Other Equity 110 149 Treasury Stock, at cost (860 ) (773 ) Accumulated Other Comprehensive Income (Loss) (19 ) (31 ) Total Stockholders Equity 1,466 1,572 Total Liabilities and Equity $ 1,466 $ 1,572 Plum Creek Timber Company, Inc. Condensed Unconsolidated Statements of Income Data Year Ended (In Millions) December31, 2009 December31, 2008 December31, 2007 Equity Earnings from Consolidated Subsidiaries $ 236 $ 233

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS
	12 Months Ended Dec. 31, 2009 USD / shares
PLUM CREEK TIMBER CO INC
FAIR VALUE MEASUREMENTS	NOTE 10. FAIR VALUE MEASUREMENTS Assets and Liabilities Measured at Fair Value on a Recurring Basis. The companys fair value measurements of its financial instruments, measured on a recurring basis, are categorized as Level 1 measurements under the fair value hierarchy in the Accounting Standards Codification. A Level 1 valuation is based on quoted prices in active markets at the measurement date for identical unrestricted assets or liabilities. Summarized below are the Level 1 assets reported in the companys financial statements at fair value, measured on a recurring basis (in millions): Balanceat December31,2009 Fair Value Measurements at Reporting Date Using Quoted Prices inActiveMarketsofIdenticalAssets (Level 1 Measurements) Cash Equivalents A $ 298 $ 298 Available-for-Sale Securities B 28 28 Trading Securities B 5 5 Total $ 331 $ 331 Balance at December 31, 2008 Fair Value Measurements at Reporting Date Using Quoted Prices in Active Markets of Identical Assets (Level 1 Measurements) Cash Equivalents A $ 346 $ 346 Available-for-Sale Securities B 20 20 Trading Securities B 5 5 Total $ 371 $ 371 A Consists of several money market funds and is included in the $299 million and $369 million of Cash and Cash Equivalents in the Consolidated Balance Sheets at December 31, 2009 and 2008, respectively. B Consist of several mutual funds which are invested in domestic (U.S.) and international equity and debt securities and are included in Investment in Grantor Trusts in the Consolidated Balance Sheets at both December 31, 2009 and 2008. Available-for-Sale Securities. Certain investments in the grantor trusts relate to the companys non-qualified pension plans and are classified as available-for-sale securities. The company has invested in various money market, debt and equity mutual funds and plans to use these investments to fund its non-qualified pension obligations. The fair value of these investments was $28 million and $20 million at December31, 2009 and 2008, respectively. Unrealized holding gains and losses are included as a component of accumulated other comprehensive income, unless an other than temporary impairment has occurred, which is then charged to expense. Unrealized holding gains were $5 million at December31, 2009 and unrealized holding losses were less than $1 million at December31, 2008. The company records changes in unrealized holding gains and losses in Other Comprehensive Income. See Note 11 of the Notes to Consolidated Financial Statements. The change in unrealized holding gains and losses was approximately $5 million for the year ended December31, 2009. Realized gains were less than $1 million in 2009 and $1 million in both 2008 and 2007. See Note12 of the Notes to Consolidated Financial Statements for discussion of the companys Pension Plans. Due to the significant declines in the U.S. equity markets during the second half of 2008, the company recognized an other than temp
PLUM CREEK TIMBERLANDS L P
FAIR VALUE MEASUREMENTS	NOTE 7. FAIR VALUE MEASUREMENTS Assets and Liabilities Measured at Fair Value on a Recurring Basis. The Operating Partnerships fair value measurements of its financial instruments, measured on a recurring basis, are categorized as Level 1 measurements under the fair value hierarchy in the Accounting Standards Codification. A Level 1 valuation is based on quoted prices in active markets at the measurement date for identical unrestricted assets or liabilities. Summarized below are the Level 1 assets reported in the Operating Partnerships financial statements at fair value, measured on a recurring basis (in millions): Balance at December31, 2009 Fair Value Measurements at Reporting Date Using Quoted Prices inActiveMarketsofIdenticalAssets (Level 1 Measurements) Cash Equivalents A $ 298 $ 298 Available-for-Sale Securities B 28 28 Trading Securities B 5 5 Total $ 331 $ 331 Balance at December31, 2008 Fair Value Measurements at Reporting Date Using Quoted Prices inActiveMarketsofIdenticalAssets (Level 1 Measurements) Cash Equivalents A $ 346 $ 346 Available-for-Sale Securities B 20 20 Trading Securities B 5 5 Total $ 371 $ 371 A Consists of several money market funds and is included in the $299 million and $369 million of Cash and Cash Equivalents in the Consolidated Balance Sheets at December31, 2009 and 2008, respectively. B Consist of several mutual funds which are invested in domestic (U.S.) and international equity and debt securities and are included in Investment in Grantor Trusts in the Consolidated Balance Sheets at both December31, 2009 and 2008. Available-for-Sale Securities. Certain investments in the grantor trusts relate to the Operating Partnerships non-qualified pension plans and are classified as available-for-sale securities. The Operating Partnership has invested in various money market, debt and equity mutual funds and plans to use these investments to fund its non-qualified pension obligations. The fair value of these investments was $28 million and $20 million at December31, 2009 and 2008, respectively. Unrealized holding gains and losses are included as a component of accumulated other comprehensive income, unless an other than temporary impairment has occurred, which is then charged to expense. Unrealized holding gains were $5 million at December31, 2009 and unrealized holding losses were less than $1 million at December31, 2008. The Operating Partnership records changes in unrealized holding gains and losses in Other Comprehensive Income. See Note 8 of the Notes to Consolidated Financial Statements. The change in unrealized holding gains and losses was approximately $5 million for the year ended December31, 2009. Realized gains were less than $1 million in 2009 and $1 million in both 2008 and 2007. See Note9 of the Notes to Consolidated Financial Statements for discussion of the Operating Partnerships Pension Plans. Due to the significant declines in the U.S. equity markets during

STOCKHOLDERS' EQUITY

STOCKHOLDERS' EQUITY (PLUM CREEK TIMBER CO INC)
	USD / shares Total
STOCKHOLDERS' EQUITY	NOTE 11. STOCKHOLDERS EQUITY At December31, 2009, Plum Creek had the following authorized capital of which 162.8million shares of common stock were issued and outstanding: 300,634,566 shares of common stock, par value $.01 per share; 150,000,001 shares of excess stock, par value $.01 per share; and 75,000,000 shares of preferred stock, par value $.01 per share. The Board of Directors, from time to time, has authorized a share repurchase program. The table below summarizes the share repurchases pursuant to this program for the years ended December31: 2009 2008 2007 Shares of Common Stock (in millions) 3.3 6.8 5.1 Total Cost of Shares (in millions) $ 87 $ 263 $ 202 Average Cost per Share $ 26.57 $ 38.51 $ 39.40 At December31, 2009, $50 million is available for share repurchases under the current Board of Directors authorization. Comprehensive Income Comprehensive income includes net income, actuarial gains and losses associated with our defined benefit pension plans and unrealized gains and losses on available-for-sale securities. Comprehensive income was as follows for the years ended December31 (in millions): PretaxAmount TaxExpense (Benefit) After-Tax Amount December31, 2007 Net Income $ 282 Unrealized Holding Gains $ 1 $ 1 Less: Reclassification to Net Income (1 ) (1 ) Defined Benefit Plans: Actuarial Gain 14 4 10 Less: Reclassification to Net Income 1 1 Prior Service Cost 1 1 Total Comprehensive Income $ 294 December31, 2008 Net Income $ 233 Unrealized Holding Losses $ (6 ) $ (6 ) Less: Reclassification to Net Income for Impairment Loss and Realized Losses on Available-for-Sale Securities 2 2 Defined Benefit Plans: Actuarial Loss (39 ) (10 ) (29 ) Less: Reclassification to Net Income Total Comprehensive Income $ 200 December31, 2009 Net Income $ 236 Unrealized Holding Gains $ 5 $ 5 Defined Benefit Plans: Actuarial Gain 3 1 2 Less: Reclassification to Net Income 7 2 5 Total Comprehensive Income $ 248 The actuarial gain of $3 million for the year ended December31, 2009, is due to the re-measurement of our benefit obligation and plan assets for our defined benefit pension as of December31, 2009. See Note 12 of the Notes to Consolidated Financial Statements. The reclassification of the net actuarial loss included in accumulated other comprehensive income of $7 million for the year ended December31, 2009 primarily represents amortization of the portion of the

Partners' Capital

Partners' Capital (PLUM CREEK TIMBERLANDS L P)
	Total
PARTNERS' CAPITAL	NOTE 8. PARTNERS CAPITAL On October1, 2008, PC Ventures I, LLC (PC Ventures), a 100% wholly-owned subsidiary of Plum Creek Timber Company, Inc., borrowed $783 million from an entity in which a subsidiary of the Operating Partnership has an equity interest. See Note 13 of the Notes to Consolidated Financial Statements. PC Ventures used the proceeds from the borrowing to make a $783 million capital contribution to the Operating Partnership in exchange for a Series T-1 Redeemable Preferred Limited Partnership Interest in the Operating Partnership (Series T-1 Preferred Interest). The Operating Partnership has no ownership interest in PC Ventures. The Series T-1 Preferred Interest provides for a return of 7.375%per annum (approximately $58 million) on its contributed capital of $783 million. Distributions are payable on February15th,May15th,August15th, and November15th each year. The Series T-1 Preferred Interest is redeemable upon liquidation of the Operating Partnership. The Series T-1 Preferred Interest has a preference in liquidation over the Common Limited Partnership Interests (Partners Capital) to the extent the Operating Partnership has available assets to distribute to the Series T-1 Preferred Interest. Under the terms of our note agreements and line of credit (see Note 6 of the Notes to Consolidated Financial Statements), the Operating Partnership is restricted from transferring assets and funds in the form of loans, advances or cash dividends to Plum Creek Timber Company, Inc. and PC Ventures. Subject to certain restrictions, the Operating Partnership can make loans or advances to Plum Creek Timber Company, Inc. and PC Ventures. Based on these provisions, the Operating Partnership could distribute or advance the cash on its balance sheet as of December31, 2009, or $299million, all of which is considered unrestricted assets. At December31, 2009, the Operating Partnership and its consolidated subsidiaries had net assets of $1,466million of which $1,167million was restricted from being transferred by the Operating Partnership to Plum Creek Timber Company, Inc. and PC Ventures. As of December31, 2009 and 2008, the undistributed earnings included in partnership capital from an entity accounted for by the equity method were $17 million and $15 million, respectively. Comprehensive Income Comprehensive income includes net income, actuarial gains and losses associated with our defined benefit pension plans and unrealized gains and losses on available-for-sale securities. Comprehensive income was as follows for the years ended December31 (in millions): PretaxAmount Tax Expense (Benefit) After-Tax Amount December31, 2007 Net Income before Allocation to Series T-1 Preferred Interest and Partners $ 282 Unrealized Holding Gains $ 1 $ 1 Less: Reclassification to Net Income (1 ) (1 ) Defined Benefit Plans: Actuarial Gain 14 4 10 Less: Reclassification to Net Income 1 1 Prior Service Cost 1 1 Total Comprehensive Inc

EMPLOYEE PENSION AND RETIREMENT

EMPLOYEE PENSION AND RETIREMENT PLANS
	12 Months Ended Dec. 31, 2009 USD / shares
PLUM CREEK TIMBER CO INC
EMPLOYEE PENSION AND RETIREMENT PLANS	NOTE 12. EMPLOYEE PENSION AND RETIREMENT PLANS Pension PlanGeneral. The company provides defined benefit pension plans that cover substantially all employees of the company. Most of the companys salaried and all hourly employees who complete one year of service in which they work at least 1,000 hours are eligible to participate in the plan. Participants vest after three years of service. The cash balance benefits for salaried employees is determined based primarily on certain percentages of compensation, age, years of service and interest accrued based on the 30-year Treasury bond rate. Participants who were employees of the company on September1, 2000, earn benefits based on the greater of the cash balance formula or a monthly pension benefit that is principally based on the highest monthly average earnings during any consecutive sixty-month out of 120-month period and the number of years of service credit. The benefits to hourly employees are generally based on a fixed amount per year of service. The company maintains a qualified defined benefit pension plan and two non-qualified defined benefit pension plans. Assets related to the non-qualified plans are held in a grantor trust and are subject to the claims of creditors in the event of bankruptcy. As a result, pension assets for the non-qualified plans are not considered plan assets, and therefore, have not been netted against our pension liability. Pension assets for the non-qualified plans are included in Investment in Grantor Trusts and the related pension liability is included in Other Liabilities and Other Current Liabilities in our Consolidated Balance Sheets. Funded Status. The following table provides a reconciliation of benefit obligations, plan assets, and funded status of the plans for the years ended December31 (in millions): 2009 2008 Change in Benefit Obligation Benefit Obligation at Beginning of Period $ 128 $ 110 Service Cost 7 6 Interest Cost 8 7 Settlements and Curtailments (17 ) Actuarial Loss 8 12 Benefits Paid (4 ) (7 ) Benefit Obligation at End of Period $ 130 $ 128 Change in Plan Assets Fair Value of Plan Assets at Beginning of Period $ 86 $ 85 Actual Return on Plan Assets 20 (22 ) Employer Contributions 11 30 Lump-Sum Settlements (17 ) Benefits Paid (4 ) (7 ) Fair Value of Plan Assets at End of Period 96 86 Funded StatusDecember31 $ (34 ) $ (42 ) Note: The Benefit Obligation reflects both the qualified and non-qualified (supplemental) plans while the Plan Assets reflects only the qualified plan. The non-qualified plan assets held in the grantor trust were $28 million and $20 million at December31, 2009 and December31, 2008, respectively. The unfunded status of our plans of $34 million at December31, 2009, is recognized in our Consolidated Balance Sheet as a current pension liability of $3 million and lon
PLUM CREEK TIMBERLANDS L P
EMPLOYEE PENSION AND RETIREMENT PLANS	NOTE 9. EMPLOYEE PENSION AND RETIREMENT PLANS Pension PlanGeneral. Plum Creek Timberlands, L.P. sponsors defined benefit pension plans that cover substantially all employees of the Operating Partnership. Most of the Operating Partnerships salaried and all hourly employees who complete one year of service in which they work at least 1,000 hours are eligible to participate in the plan. Participants vest after three years of service. The cash balance benefits for salaried employees is determined based primarily on certain percentages of compensation, age, years of service and interest accrued based on the 30-year Treasury bond rate. Participants who were employees of the Operating Partnership on September1, 2000, earn benefits based on the greater of the cash balance formula or a monthly pension benefit that is principally based on the highest monthly average earnings during any consecutive sixty-month out of 120-month period and the number of years of service credit. The benefits to hourly employees are generally based on a fixed amount per year of service. The Operating Partnership maintains a qualified defined benefit pension plan and two non-qualified defined benefit pension plans. Assets related to the non-qualified plans are held in a grantor trust and are subject to the claims of creditors in the event of bankruptcy. As a result, pension assets for the non-qualified plans are not considered plan assets, and therefore, have not been netted against our pension liability. Pension assets for the non-qualified plans are included in Investment in Grantor Trusts and the related pension liability is included in Other Liabilities and Other Current Liabilities in our Consolidated Balance Sheets. Funded Status. The following table provides a reconciliation of benefit obligations, plan assets, and funded status of the plans for the years ended December31 (in millions): 2009 2008 Change in Benefit Obligation Benefit Obligation at Beginning of Period $ 128 $ 110 Service Cost 7 6 Interest Cost 8 7 Settlements and Curtailments (17 ) Actuarial Loss 8 12 Benefits Paid (4 ) (7 ) Benefit Obligation at End of Period $ 130 $ 128 Change in Plan Assets Fair Value of Plan Assets at Beginning of Period $ 86 $ 85 Actual Return on Plan Assets 20 (22 ) Employer Contributions 11 30 Lump-Sum Settlements (17 ) Benefits Paid (4 ) (7 ) Fair Value of Plan Assets at End of Period 96 86 Funded StatusDecember31 $ (34 ) $ (42 ) Note: The Benefit Obligation reflects both the qualified and non-qualified (supplemental) plans while the Plan Assets reflects only the qualified plan. The non-qualified plan assets held in the grantor trust were $28 million and $20 million at December31, 2009 and December31, 2008, respectively. The unfunded status of our plans of $34 million at December31, 2009, is recognized in our Consolidate

SHARE-BASED COMPENSATION PLANS

SHARE-BASED COMPENSATION PLANS
	12 Months Ended Dec. 31, 2009 USD / shares
PLUM CREEK TIMBER CO INC
SHARE-BASED COMPENSATION PLANS	NOTE 13. SHAREBASED COMPENSATION PLANS Plum Creek has a stockholder approved Stock Incentive Plan that provides for the award of non-qualified stock options, restricted stock and restricted stock units, value management awards and dividend equivalents. Under Plum Creeks Stock Incentive Plan (the Plan), as amended in May 2004, there are 12.4million shares of common stock reserved and eligible for issuance. At December31, 2009, 5.0million shares of the 12.4million reserved shares have been used and, therefore, 7.4million shares remain available for grants of non-qualified stock options, grants of restricted stock and restricted stock units, or payments of vested value management awards and dividend equivalents. The number of shares to be issued in connection with value management awards and dividend equivalents is not determined until the end of their respective performance periods. New shares are issued for payment under the Plan for awards that pay out in shares or where the participant can elect payment in shares. Stock Options. Under the Plan, non-qualified stock options may be granted to any officer, director, employee, consultant or advisor of the company. Each stock option granted allows the recipient the right to purchase the companys common stock at the fair market value of the companys common stock on the date of the grant. Generally, the stock options have a ten-year term and vest over a four-year period at a rate of 25%per year. Under the Plan, the exercise price of an option may not be reduced. Presented below is a summary of Plum Creeks stock option Plan activity for the year ended December31, 2009: Shares Subjectto Options Weighted- Average Exercise Price Weighted- Average Remaining Contractual Life (Years) Aggregate IntrinsicValue (Millions) Balance at January1, 2009 2,408,870 $ 35.89 Granted 559,650 33.75 Exercised/Surrendered (14,056 ) 17.33 Cancelled/Forfeited (93,549 ) 38.73 Outstanding, December31, 2009 2,860,915 $ 35.47 6.3 $ 10 Vested or Expected to Vest, December31, 2009 2,563,796 $ 35.27 6.2 $ 10 Exercisable, December31, 2009 1,633,453 $ 33.61 4.9 $ 8 The table below presents stock activity related to stock options exercised during the years ended December31 (in millions): 2009 2008 2007 Proceeds from Stock Options Exercised $ $ 14 $ 8 Intrinsic Value of Stock Options Exercised $ $ 9 $ 6 Tax Benefit Related to Stock Options Exercised $ $ 1.9 $ 0.8 The weighted-average measurement date fair values of stock option awards granted were computed using the Black-Scholes-Merton option valuation model with the following assumptions for the years ended December31: 2009 2008 2007 Expected Term (years) 6 6 6 Risk-Free Interest Rate 2.0 % 3.0 % 4.8 % Volatility 35.5 % 23.2 % 22.2 % Dividend Yield 5.0 % 3.9 %
PLUM CREEK TIMBERLANDS L P
SHARE-BASED COMPENSATION PLANS	NOTE 10. SHAREBASED COMPENSATION PLANS Plum Creek Timber Company, Inc. has a stockholder approved Stock Incentive Plan that provides for the award of non-qualified stock options, restricted stock and restricted stock units, value management awards and dividend equivalents. Certain executives and key employees of the Operating Partnership are covered by this plan. All of Plum Creeks activities are conducted through the Operating Partnership, therefore all share-based compensation expense is allocated to the Operating Partnership. Proceeds from the exercise of Plum Creek stock options are retained by Plum Creek Timber Company, Inc. Under Plum Creeks Stock Incentive Plan (the Plan), as amended in May 2004, there are 12.4million shares of Plum Creek Timber Company, Inc. common stock reserved and eligible for issuance. At December31, 2009, 5.0million shares of the 12.4million reserved shares have been used and, therefore, 7.4million shares remain available for grants of non-qualified stock options, grants of restricted stock and restricted stock units, or payments of vested value management awards and dividend equivalents. The number of shares to be issued in connection with value management awards and dividend equivalents is not determined until the end of their respective performance periods. New shares are issued for payment under the Plan for awards that pay out in shares or where the participant can elect payment in shares. Stock Options. Under the Plan, non-qualified stock options may be granted to any officer, director, employee, consultant or advisor of the Operating Partnership. Each stock option granted allows the recipient the right to purchase Plum Creeks common stock at the fair market value of Plum Creeks common stock on the date of the grant. Generally, the stock options have a ten-year term and vest over a four-year period at a rate of 25%per year. Under the Plan, the exercise price of an option may not be reduced. Presented below is a summary of Plum Creeks stock option Plan activity for the year ended December31, 2009: Shares Subjectto Options Weighted- Average Exercise Price Weighted- Average Remaining Contractual Life (Years) Aggregate IntrinsicValue (Millions) Balance at January1, 2009 2,408,870 $ 35.89 Granted 559,650 33.75 Exercised/Surrendered (14,056 ) 17.33 Cancelled/Forfeited (93,549 ) 38.73 Outstanding, December31, 2009 2,860,915 $ 35.47 6.3 $ 10 Vested or Expected to Vest, December31, 2009 2,563,796 $ 35.27 6.2 $ 10 Exercisable, December31, 2009 1,633,453 $ 33.61 4.9 $ 8 The table below presents stock activity related to stock options exercised during the years ended December31 (in millions): 2009 2008 2007 Proceeds from Stock Options Exercised $ $ 14 $ 8 Intrinsic Value of Stock Options Exercised $ $ 9 $ 6 Tax Benefit Related to Stock Options Exercised $ $ 1.9 $ 0.8 The weighted-average measurement date

DETAIL OF CERTAIN BALANCE SHEET

DETAIL OF CERTAIN BALANCE SHEET ACCOUNTS
	12 Months Ended Dec. 31, 2009 USD / shares
PLUM CREEK TIMBER CO INC
DETAIL OF CERTAIN BALANCE SHEET ACCOUNTS	NOTE 14. DETAIL OF CERTAIN BALANCE SHEET ACCOUNTS Certain balance sheet accounts consisted of the following (in millions): December31, 2009 December31, 2008 Other Current Assets Prepaid Expenses $ 7 $ 10 Notes Receivable 6 Other 1 $ 13 $ 11 Other Non-Current Assets Real Estate Development Properties $ 15 $ 18 Unamortized Debt Issue Costs 6 8 Deposits 6 6 Notes Receivable 8 6 Other 3 4 $ 38 $ 42 Other Current Liabilities Long-Term Incentive Compensation $ 12 $ 13 Accrued Pension Liability 3 3 Workers Compensation 3 3 Other 3 2 $ 21 $ 21 Other Non-Current Liabilities Timber Obligations $ 6 $ 7 Deferred Compensation 5 5 Long-Term Incentive Compensation 4 11 Accrued Pension Liability 31 39 Deferred Revenue from Long-Term Gas Leases 9 12 Workers Compensation 11 11 Other 5 5 $ 71 $ 90
PLUM CREEK TIMBERLANDS L P
DETAIL OF CERTAIN BALANCE SHEET ACCOUNTS	NOTE 11. DETAIL OF CERTAIN BALANCE SHEET ACCOUNTS Certain balance sheet accounts consisted of the following (in millions): December31, 2009 December31, 2008 Other Current Assets Prepaid Expenses $ 7 $ 10 Notes Receivable 6 Other 1 $ 13 $ 11 Other Non-Current Assets Real Estate Development Properties $ 15 $ 18 Unamortized Debt Issue Costs 6 8 Deposits 6 6 Notes Receivable 8 6 Other 3 4 $ 38 $ 42 Other Current Liabilities Long-Term Incentive Compensation $ 12 $ 13 Accrued Pension Liability 3 3 Workers Compensation 3 3 Other 3 2 $ 21 $ 21 Other Non-Current Liabilities Timber Obligations $ 6 $ 7 Deferred Compensation 6 6 Long-Term Incentive Compensation 4 11 Accrued Pension Liability 31 39 Deferred Revenue from Long-Term Gas Leases 9 12 Workers Compensation 11 11 Other 5 5 $ 72 $ 91

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES
	12 Months Ended Dec. 31, 2009 USD / shares
PLUM CREEK TIMBER CO INC
COMMITMENTS AND CONTINGENCIES	NOTE 15. COMMITMENTS AND CONTINGENCIES Contingencies. The company is subject to regulations regarding forest and harvest practices and is, from time to time, involved in various legal proceedings, including environmental and regulatory matters, incidental to its business. Reserves have been established for any probable losses. Environmental Contingencies. In connection with the October6, 2001 merger with The Timber Company, Plum Creek agreed to indemnify Georgia-Pacific for substantially all of the liabilities attributed to The Timber Company. During 2003, Georgia-Pacific provided Plum Creek with information about the existence of mine tailings and acidic surface water on approximately 90 acres in Hot Spring County, Arkansas, on former Georgia-Pacific properties. Barite mining and related activities were conducted on the site between 1939 and 1981 in part by lessees of an entity that was acquired by Georgia-Pacific. The company believes that it has strong defenses in the matter. Furthermore, to the extent Plum Creek is required to indemnify Georgia-Pacific for its share of the remediation costs, Plum Creek may be able to recover all or a portion of its cost from Georgia-Pacifics insurance policy, or indemnity obligations of the various lessees that conducted mining operations on the property, or both. The company believes it will be successful in defending the claim. If the company is not successful in defending this claim, we believe that any loss would not be material to our financial position or results of operations. Unrecorded Contingencies. Management currently believes that resolving other pending legal proceedings against the company, individually or in aggregate, will not have a material adverse impact on our financial position or results of operations. However, these matters are subject to inherent uncertainties and managements view on these matters may change in the future. Were an unfavorable final outcome in one or multiple legal proceedings to occur, there exists the possibility of a material adverse impact on our financial position and the results of operations for the period in which any unfavorable outcome becomes reasonably estimable. Contractual Obligations. The company has contracted to source logs and supply fiber with customers under long-term agreements at prevailing market rates. The agreements expire beginning in 2010 through 2023, with various renewal options by either party for periods ranging from two years to fifteen additional years. Lease Commitments. The company leases buildings and equipment under noncancelable operating lease agreements. The company leases certain timberlands in which the company acquired title to the standing timber at the inception of the lease. Operating lease expense was $5 million in 2009 and $7 million in both 2008 and 2007. The following summarizes the future minimum operating lease payments and obligations in connection with leasing timberlands at December31, 2009 (in millions): Operating Leases Timber Obligations 2010 $ 4 $ 1 2011 3 1 2012 3 2013 2 2014 2 Thereafter 3 4
PLUM CREEK TIMBERLANDS L P
COMMITMENTS AND CONTINGENCIES	NOTE 12. COMMITMENTS AND CONTINGENCIES Contingencies. The Operating Partnership is subject to regulations regarding forest and harvest practices and is, from time to time, involved in various legal proceedings, including environmental and regulatory matters, incidental to its business. Reserves have been established for any probable losses. Environmental Contingencies. In connection with the October6, 2001 merger with The Timber Company, Plum Creek agreed to indemnify Georgia-Pacific for substantially all of the liabilities attributed to The Timber Company. During 2003, Georgia-Pacific provided Plum Creek with information about the existence of mine tailings and acidic surface water on approximately 90 acres in Hot Spring County, Arkansas, on former Georgia-Pacific properties. Barite mining and related activities were conducted on the site between 1939 and 1981 in part by lessees of an entity that was acquired by Georgia-Pacific. The Operating Partnership believes that it has strong defenses in the matter. Furthermore, to the extent the Operating Partnership is required to indemnify Georgia-Pacific for its share of the remediation costs, the Operating Partnership may be able to recover all or a portion of its cost from Georgia-Pacifics insurance policy, or indemnity obligations of the various lessees that conducted mining operations on the property, or both. The Operating Partnership believes it will be successful in defending the claim. If the Operating Partnership is not successful in defending this claim, we believe that any loss would not be material to our financial position or results of operations. Unrecorded Contingencies. Management currently believes that resolving other pending legal proceedings against the Operating Partnership, individually or in aggregate, will not have a material adverse impact on our financial position or results of operations. However, these matters are subject to inherent uncertainties and managements view on these matters may change in the future. Were an unfavorable final outcome in one or multiple legal proceedings to occur, there exists the possibility of a material adverse impact on our financial position and the results of operations for the period in which any unfavorable outcome becomes reasonably estimable. Contractual Obligations. The Operating Partnership has contracted to source logs and supply fiber with customers under long-term agreements at prevailing market rates. The agreements expire beginning in 2010 through 2023, with various renewal options by either party for periods ranging from two years to fifteen additional years. Lease Commitments. The Operating Partnership leases buildings and equipment under noncancelable operating lease agreements. The Operating Partnership leases certain timberlands in which the Operating Partnership acquired title to the standing timber at the inception of the lease. Operating lease expense was $5 million in 2009 and $7 million in both 2008 and 2007. The following summarizes the future minimum operating lease payments and obligations in connection with leasing timberlands at December31, 2009 (in millions): Operating Lease

TIMBERLAND VENTURE-EQUITY METHO

TIMBERLAND VENTURE-EQUITY METHOD INVESTMENT
	12 Months Ended Dec. 31, 2009 USD / shares
PLUM CREEK TIMBER CO INC
TIMBERLAND VENTURE-EQUITY METHOD INVESTMENT	NOTE 16. TIMBERLAND VENTUREEQUITY METHOD INVESTMENT On October1, 2008, the company contributed 454,000 acres of timberlands located in its Southern Resources Segment to Southern Diversified Timber, LLC (the Timberland Venture) in exchange for a $705 million preferred interest and a 9% common interest valued at $78 million. The Timberland Ventures other member, an affiliate of The Campbell Group LLC, contributed $783 million of cash in exchange for 91% of the Timberland Ventures common interest. Following the contribution, the company borrowed $783 million from the Timberland Venture (Note Payable to Timberland Venture). The preferred interest is entitled to a cumulative preferred return equal to 7.875%per annum (approximately $56 million). No distributions can be made on the common interests until all current period and prior period preferred returns have been paid. The preferred interest has a preference in liquidation over the common interests. Preferred return distributions are payable on March15th and September15th each year. The annual interest rate on the Note Payable to Timberland Venture is fixed at 7.375%, resulting in annual interest expense of approximately $58 million. During the ten-year term of the note, interest is paid quarterly with the principal due upon maturity. The Timberland Venture can only be liquidated with the consent of both partners. However, upon the nine year anniversary of the Timberland Venture, Plum Creek has the right for a six-month period to cause the Timberland Venture to redeem the other partners interest. The other Timberland Venture partner has a similar redemption right after the seven year anniversary. The activities of the Timberland Venture consist primarily of the ownership of timberlands and entering into cutting contracts with an affiliate of The Campbell Group for the sale and harvesting of timber. An affiliate of The Campbell Group is the manager of the Timberland Venture. The manager and the other member control the day-to-day operating decisions of the Timberland Venture. Plum Creek retains certain protective rights that require its consent before the Timberland Venture can take certain actions. For example, without Plum Creeks consent and subject to certain exceptions, the Timberland Venture generally cannot sell properties, incur indebtedness, file for bankruptcy or enter into contracts with affiliates which are not arms length. No gain was recognized in connection with the contribution of the timberlands to the venture in 2008. The book basis in the contributed timberlands was $174 million, and the company capitalized costs of $9 million in connection with the transfer. The Timberland Venture recorded the contributed timberlands at fair value, or $783 million. The difference between the beginning book basis in the venture ($174 million) and the companys share of the equity in the net assets of the venture ($783 million) was allocated between standing timber ($289 million) and land ($320 million). In addition to the allocation of earnings to our common and preferred interests, the basis difference associated with standing timber is amortized into equity earnings based on th
PLUM CREEK TIMBERLANDS L P
TIMBERLAND VENTURE-EQUITY METHOD INVESTMENT	NOTE 13. TIMBERLAND VENTUREEQUITY METHOD INVESTMENT On October1, 2008, a subsidiary of the Operating Partnership, Plum Creek Timber Operations I, LLC (PC Member), contributed 454,000 acres of timberlands located in its Southern Resources Segment to Southern Diversified Timber, LLC (the Timberland Venture) in exchange for a $705 million preferred interest and a 9% common interest valued at $78 million. The Timberland Ventures other member, an affiliate of The Campbell Group LLC, contributed $783 million of cash in exchange for 91% of the Timberland Ventures common interest. Following the contribution, Plum Creek Ventures I, LLC (PC Ventures), a 100% wholly-owned subsidiary of Plum Creek Timber Company, Inc., borrowed $783 million from the Timberland Venture. PC Ventures used the proceeds from the borrowing to make a $783 million capital contribution to the Operating Partnership. See Note 8 of the Notes to Consolidated Financial Statements. PC Members preferred interest in the Timberland Venture is entitled to a cumulative preferred return equal to 7.875%per annum (approximately $56 million). The Timberland Venture cannot make distributions on the common interests until all current period and prior period preferred returns have been paid. The preferred interest has a preference in liquidation over the common interests. Preferred return distributions are payable on March15th and September15 th each year. The Timberland Venture can only be liquidated with the consent of both partners. However, upon the nine year anniversary of the Timberland Venture, Plum Creek has the right for a six-month period to cause the Timberland Venture to redeem the other partners interest. The other Timberland Venture partner has a similar redemption right after the seven year anniversary. The activities of the Timberland Venture consist primarily of the ownership of timberlands and entering into cutting contracts with an affiliate of The Campbell Group for the sale and harvesting of timber. An affiliate of The Campbell Group is the manager of the Timberland Venture. The manager and the other member control the day-to-day operating decisions of the Timberland Venture. PC Member retains certain protective rights that require its consent before the Timberland Venture can take certain actions. For example, without PC Members consent and subject to certain exceptions, the Timberland Venture generally cannot sell properties, incur indebtedness, file for bankruptcy or enter into contracts with affiliates which are not arms length. No gain was recognized in connection with the contribution of the timberlands to the venture in 2008. The book basis in the contributed timberlands was $174 million, and PC Member capitalized costs of $9 million in connection with the transfer. The Timberland Venture recorded the contributed timberlands at fair value, or $783 million. The difference between the beginning book basis in the venture ($174 million) and PC Members share of the equity in the net assets of the venture ($783 million) was allocated between standing timber ($289 million) and land ($320 million). In addition to the allocation of earnings to our common and preferr

VARIABLE INTEREST ENTITIES

VARIABLE INTEREST ENTITIES
	12 Months Ended Dec. 31, 2009 USD / shares
PLUM CREEK TIMBER CO INC
VARIABLE INTEREST ENTITIES	NOTE 17. VARIABLE INTEREST ENTITIES The Timberland Venture is a variable interest entity. See Note 16 of the Notes to Consolidated Financial Statements. Besides quarterly interest payments on the Note Payable to Timberland Venture, the company has not provided financing or other support to the venture. The venture is financed by a line of credit obtained by the Timberland Venture. We are not the primary beneficiary of the Timberland Venture. The company does not manage the day-to-day operations of the venture, has only limited protective rights and its involvement is generally limited to receiving distributions on its preferred and common interests. We are not the primary beneficiary because we are not required to absorb the majority of the expected losses. The common interests are required to absorb losses based on positive capital accounts before any losses can be allocated to our preferred interest, and we own a 9% common interest. The carrying amount of the investment in the venture is $201 million at December31, 2009 and $199 million at December31, 2008, and is reported in the Consolidated Balance Sheets as Equity Investment in Timberland Venture. Our maximum exposure to loss is $201 million, the carrying amount of the investment in the venture. Generally, losses are first allocated among the common interests based on positive capital accounts in which we hold a 9% common interest. No losses are allocated to our preferred interest ($705 million) until the common interests have absorbed losses of approximately $861 million.
PLUM CREEK TIMBERLANDS L P
VARIABLE INTEREST ENTITIES	NOTE 14. VARIABLE INTEREST ENTITIES The Timberland Venture is a variable interest entity. See Note 13 of the Notes to Consolidated Financial Statements. Besides quarterly distributions of the Series T-1 Preferred Interest to PC Ventures to fund interest payments on the loan by PC Ventures, the Operating Partnership has not provided financing or other support to the venture. See Note 8 of the Notes to Consolidated Financial Statements. The venture is financed by a line of credit obtained by the Timberland Venture. We are not the primary beneficiary of the Timberland Venture. PC Member does not manage the day-to-day operations of the venture, has only limited protective rights and its involvement is generally limited to receiving distributions on its preferred and common interests. We are not the primary beneficiary because we are not required to absorb the majority of the expected losses. The common interests are required to absorb losses based on positive capital accounts before any losses can be allocated to our preferred interest, and we own a 9% common interest. The carrying amount of the investment in the venture is $201 million at December31, 2009 and $199 million at December31, 2008, and is reported in the Consolidated Balance Sheets as Equity Investment in Timberland Venture. Our maximum exposure to loss is $201 million, the carrying amount of the investment in the venture. Generally, losses are first allocated among the common interests based on positive capital accounts in which we hold a 9% common interest. No losses are allocated to our preferred interest ($705 million) until the common interests have absorbed losses of approximately $861 million.

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS
	12 Months Ended Dec. 31, 2009 USD / shares
PLUM CREEK TIMBER CO INC
RELATED PARTY TRANSACTIONS	NOTE 18. RELATED PARTY TRANSACTIONS On October1, 2008, the company contributed 454,000 acres of timberlands to Southern Diversified Timber, LLC (the Timberland Venture) in exchange for a common and preferred interest. Both interests are accounted for under the equity method of accounting. See Note 16 of the Notes to Consolidated Financial Statements. During 2009, the company recorded its share of equity earnings from the Timberland Venture of $55 million, which includes $7 million of amortization of the difference between the book value of the companys investment and its proportionate share of the Timberland Ventures net assets. During 2008, the company recorded equity earnings of $15 million, which includes $1 million of amortization. During 2009, the company received $53 million in distributions from the Timberland Venture associated with its preferred interest. No distributions were made by the Timberland Venture to the company during 2008. Also, on October1, 2008, the company borrowed $783 million from the Timberland Venture for a ten-year term at a fixed annual interest rate of 7.375%. The related party obligation is included in the Consolidated Balance Sheet as Note Payable to Timberland Venture. During 2009, the company recorded $58 million of interest expense related to the note and made interest payments of $58 million to the Timberland Venture. During 2008, the company recorded $14 million of interest expense related to the note and made interest payments of $7 million. At both December31, 2009 and December31, 2008, the company had accrued interest payable of $7 million for the Note Payable to Timberland Venture.
PLUM CREEK TIMBERLANDS L P
RELATED PARTY TRANSACTIONS	NOTE 15. RELATED PARTY TRANSACTIONS Transactions with Parent. The Operating Partnerships parent, Plum Creek Timber Company, Inc., provides share-based compensation plans that cover employees of the Operating Partnership (see Note 10 of the Notes to Consolidated Financial Statements). All of Plum Creeks activities are conducted through the Operating Partnership. Therefore, all share-based compensation expense is allocated to the Operating Partnership. Transactions with Other Related Parties. On October1, 2008, the Operating Partnership contributed 454,000 acres of timberlands to Southern Diversified Timber, LLC (the Timberland Venture) in exchange for a common and preferred interest. Both interests are accounted for under the equity method of accounting. See Note 13 of the Notes to Consolidated Financial Statements. During 2009, the Operating Partnership recorded its share of equity earnings from the Timberland Venture of $55 million, which includes $7 million of amortization of the difference between the book value of the Operating Partnerships investment and its proportionate share of the Timberland Ventures net assets. During 2008, the Operating Partnership recorded equity earnings of $15 million, which includes $1 million of amortization. During 2009, the Operating Partnership received $53 million in distributions from the Timberland Venture associated with its preferred interest. No distributions were made by the Timberland Venture to the Operating Partnership during 2008. Also, on October1, 2008, PC Ventures I, LLC (PC Ventures), a 100% wholly-owned subsidiary of Plum Creek Timber Company, Inc., borrowed $783 million from the Timberland Venture for a ten-year term at a fixed annual interest rate of 7.375%. PC Ventures used the proceeds from the borrowing to make a $783 million capital contribution to the Operating Partnership in exchange for a Series T-1 Redeemable Preferred Limited Partnership Interest. See Note 8 of the Notes to Consolidated Financial Statements. For the years ended December31, 2009 and 2008, the Operating Partnership made cash distributions to PC Ventures of $58 million and $7 million, respectively.

SEGMENT INFORMATION

SEGMENT INFORMATION
	12 Months Ended Dec. 31, 2009 USD / shares
PLUM CREEK TIMBER CO INC
SEGMENT INFORMATION	NOTE 19. SEGMENT INFORMATION The company is organized into five operating segments based on the nature of the business activities of each component. Each operating segment has a separate management team. The measurement of operating segment results is generally consistent with the presentation of the Consolidated Statements of Income. Intersegment Revenues are recorded at market prices, which are determined at least quarterly, and are eliminated in the consolidated results. Several operating segments have sales outside of the U.S. (see Export Revenues), but the company does not hold any long-lived foreign assets. These operating segments represent the companys five reportable segments, which are: (1)Northern Resources, (2)Southern Resources, (3)Real Estate, (4)Manufactured Products and (5)Other. Northern Resources Segment. The Northern Resources Segment consists of timberlands located in Maine, Michigan, Montana, New Hampshire, Oregon, Vermont, Washington, West Virginia and Wisconsin. The Northern Resources Segment grows timber for sale primarily in domestic regional markets. Additionally, some logs are sold in export markets, mainly to Canada. The Northern Resources Segment sells softwood and hardwood sawlogs and softwood and hardwood pulpwood. Softwood sawlogs are sold to regional lumber and plywood manufacturers. Logs harvested in Montana are sold mostly to the companys Manufactured Products Segment (see Intersegment Revenues). Hardwood sawlogs are sold primarily to regional lumber and plywood manufacturers. Softwood and hardwood pulpwood is sold to regional paper and packaging manufacturers. Southern Resources Segment. The Southern Resources Segment consists of timberlands located in Alabama, Arkansas, Florida, Georgia, Louisiana, Mississippi, North Carolina, Oklahoma, South Carolina and Texas. The Southern Resources Segment grows timber for sale in domestic regional markets. The Southern Resources Segment sells primarily softwood sawlogs and pulpwood. Softwood sawlogs are sold to regional lumber and plywood manufacturers. Softwood pulpwood is sold to regional paper and packaging manufacturers and also to producers of oriented strand board. Additionally, the Southern Resources Segment leases a portion of our timberlands to third parties on an annual basis for recreational purposes. Real Estate Segment. The Real Estate Segment consists of sales of higher value timberlands and non-strategic timberlands, including, from time to time, the sale of large blocks of timberlands. We estimate that included in the companys 7million acres of timberlands are approximately 1.35million acres of higher value timberlands, which are expected to be sold and/or developed over the next fifteen years for recreational, conservation or residential purposes. Included within the 1.35million acres of higher value timberlands are approximately 1million acres we expect to sell for recreational uses, approximately 200,000 acres we expect to sell for conservation and approximately 150,000 acres that are identified as having development potential. In addition, the company has approximately 250,000 acres of non-strategic timberlands, which are expected to be s
PLUM CREEK TIMBERLANDS L P
SEGMENT INFORMATION	NOTE 16. SEGMENT INFORMATION The Operating Partnership is organized into five operating segments based on the nature of the business activities of each component. Each operating segment has a separate management team. The measurement of operating segment results is generally consistent with the presentation of the Consolidated Statements of Income. Intersegment Revenues are recorded at market prices, which are determined at least quarterly, and are eliminated in the consolidated results. Several operating segments have sales outside of the U.S. (see Export Revenues), but the Operating Partnership does not hold any long-lived foreign assets. These operating segments represent the Operating Partnerships five reportable segments, which are: (1)Northern Resources, (2)Southern Resources, (3)Real Estate, (4)Manufactured Products and (5)Other. Northern Resources Segment. The Northern Resources Segment consists of timberlands located in Maine, Michigan, Montana, New Hampshire, Oregon, Vermont, Washington, West Virginia and Wisconsin. The Northern Resources Segment grows timber for sale primarily in domestic regional markets. Additionally, some logs are sold in export markets, mainly to Canada. The Northern Resources Segment sells softwood and hardwood sawlogs and softwood and hardwood pulpwood. Softwood sawlogs are sold to regional lumber and plywood manufacturers. Logs harvested in Montana are sold mostly to the Operating Partnerships Manufactured Products Segment (see Intersegment Revenues). Hardwood sawlogs are sold primarily to regional lumber and plywood manufacturers. Softwood and hardwood pulpwood is sold to regional paper and packaging manufacturers. Southern Resources Segment. The Southern Resources Segment consists of timberlands located in Alabama, Arkansas, Florida, Georgia, Louisiana, Mississippi, North Carolina, Oklahoma, South Carolina and Texas. The Southern Resources Segment grows timber for sale in domestic regional markets. The Southern Resources Segment sells primarily softwood sawlogs and pulpwood. Softwood sawlogs are sold to regional lumber and plywood manufacturers. Softwood pulpwood is sold to regional paper and packaging manufacturers and also to producers of oriented strand board. Additionally, the Southern Resources Segment leases a portion of our timberlands to third parties on an annual basis for recreational purposes. Real Estate Segment. The Real Estate Segment consists of sales of higher value timberlands and non-strategic timberlands, including, from time to time, the sale of large blocks of timberlands. We estimate that included in the Operating Partnerships 7million acres of timberlands are approximately 1.35million acres of higher value timberlands, which are expected to be sold and/or developed over the next fifteen years for recreational, conservation or residential purposes. Included within the 1.35million acres of higher value timberlands are approximately 1million acres we expect to sell for recreational uses, approximately 200,000 acres we expect to sell for conservation and approximately 150,000 acres that are identified as having development potential. In addition, the Operating Partnership has

Subsequent Event

Subsequent Event (PLUM CREEK TIMBER CO INC)
	12 Months Ended Dec. 31, 2009 USD / shares
Subsequent Event	Note 20. Subsequent Event On February9, 2010, our Board of Directors authorized Plum Creek Timber Company, Inc. to make a dividend distribution of $.42 per share. Total dividends of approximately $68 million will be paid on March5, 2010, to stockholders of record on February19, 2010.

UNAUDITED SELECTED QUARTERLY FI

UNAUDITED SELECTED QUARTERLY FINANCIAL DATA
	12 Months Ended Dec. 31, 2009 USD / shares
PLUM CREEK TIMBER CO INC
UNAUDITED SELECTED QUARTERLY FINANCIAL DATA	NOTE 21. UNAUDITED SELECTED QUARTERLY FINANCIAL DATA (In Millions, Except Per Share Amounts) 1stQuarterB 2ndQuarter 3rdQuarter 4thQuarterC 2009 Revenues $ 470 $ 272 $ 294 $ 258 Gross Profit 191 76 58 80 Operating Income 159 53 38 49 Net Income 157 32 19 28 Net Income per ShareBasicA $ 0.95 $ 0.19 $ 0.12 $ 0.17 Net Income per ShareDilutedA $ 0.95 $ 0.19 $ 0.12 $ 0.17 2008 Revenues $ 363 $ 376 $ 414 $ 461 Gross Profit 96 90 131 140 Operating Income 69 57 99 103 Net Income 38 31 69 95 Net Income per ShareBasicA $ 0.22 $ 0.18 $ 0.40 $ 0.57 Net Income per ShareDilutedA $ 0.22 $ 0.18 $ 0.40 $ 0.57 A Net income per share is computed independently for each of the quarters presented. Therefore, the sum of the quarterly net income per share may not equal the total computed for the year. B During the first quarter of 2009, the company paid approximately $4 million to retire $5 million of principal for our public debt (Senior Notes due in 2015) resulting in a $1 million gain, net of unamortized discount and debt issuance costs. This gain is included in Gain (Loss) on Extinguishment of Debt in the Consolidated Statements of Income. C During the fourth quarter of 2009, the company paid approximately $71 million to retire $68 million of principal for senior notes scheduled to mature in the fourth quarter of 2011, resulting in a $3 million loss, net of unamortized discount and debt issuance costs. This loss is included in Gain (Loss) on Extinguishment of Debt in the Consolidated Statements of Income. During the fourth quarter of 2008, the company paid approximately $50 million to retire $62 million of principal for our public debt (Senior Notes due in 2015). The company recognized a gain in 2008 of $11 million, net of unamortized discount and debt issuance costs. This gain is classified as Gain (Loss) on Extinguishment of Debt in the Consolidated Statements of Income.
PLUM CREEK TIMBERLANDS L P
UNAUDITED SELECTED QUARTERLY FINANCIAL DATA	NOTE 17. UNAUDITED SELECTED QUARTERLY FINANCIAL DATA (in millions) 1stQuarterA 2ndQuarter 3rdQuarter 4thQuarterB 2009 Revenues $ 470 $ 272 $ 294 $ 258 Gross Profit 191 76 58 80 Operating Income 159 53 38 49 Net Income Available to Common Interest Partners 157 32 19 28 2008 Revenues $ 363 $ 376 $ 414 $ 461 Gross Profit 96 90 131 140 Operating Income 69 57 99 103 Net Income Available to Common Interest Partners 38 31 69 95 A During the first quarter of 2009, the Operating Partnership paid approximately $4 million to retire $5 million of principal for our public debt (Senior Notes due in 2015) resulting in a $1 million gain, net of unamortized discount and debt issuance costs. This gain is included in Gain (Loss) on Extinguishment of Debt in the Consolidated Statements of Income. B During the fourth quarter of 2009, the Operating Partnership paid approximately $71 million to retire $68 million of principal for senior notes scheduled to mature in the fourth quarter of 2011, resulting in a $3 million loss, net of unamortized discount and debt issuance costs. This loss is included in Gain (Loss) on Extinguishment of Debt in the Consolidated Statements of Income. During the fourth quarter of 2008, the Operating Partnership paid approximately $50 million to retire $62 million of principal for our public debt (Senior Notes due in 2015). The Operating Partnership recognized a gain in 2008 of $11 million, net of unamortized discount and debt issuance costs. This gain is classified as Gain (Loss) on Extinguishment of Debt in the Consolidated Statements of Income.

Supplemental Disclosures

Supplemental Disclosures (PLUM CREEK TIMBERLANDS L P)
	12 Months Ended Dec. 31, 2009
Supplemental Disclosures	Included in this item are the consolidated financial statements related to Plum Creek Timberlands, L.P., a Delaware Limited Partnership and a wholly-owned subsidiary of Plum Creek Timber Company, Inc. These financial statements are provided pursuant to Rule 3-10 of Regulation S-X in connection with the shelf registration statement on Form S-3 filed in April of 2009 pursuant to which Plum Creek Timberlands, L.P. has registered and from time to time may offer and sell debt securities. As of December31, 2009, Plum Creek Timberlands, L.P. has publicly issued and outstanding $458 million aggregate principal amount of its 5.875% Senior Notes (debt securities) pursuant to the shelf registration statement.

Document Information

Document Information
	12 Months Ended Dec. 31, 2009
Document Type	10-K
Amendment Flag	false
Document Period End Date	2009-12-31

Entity Information

Entity Information (USD $)
	12 Months Ended Dec. 31, 2009	Feb. 19, 2010	Jun. 30, 2009
Trading Symbol	PCL
Entity Registrant Name	PLUM CREEK TIMBER CO INC
Entity Central Index Key	0000849213
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		162,902,977
Entity Public Float			$4,828,947,616
PLUM CREEK TIMBERLANDS L P
Entity Registrant Name	Plum Creek Timberlands L P
Entity Central Index Key	0001296350
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	No
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Non-accelerated Filer
Entity Public Float			$0