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                                                               Exhibit 10(o)(i)

                      FIRST AMENDMENT TO CREDIT AGREEMENT

         THIS FIRST AMENDMENT TO CREDIT AGREEMENT (this "Amendment"), dated as
of August 27, 2001, is made by and among POTLATCH CORPORATION, a Delaware
corporation (the "Company"), the Subsidiary Guarantors party hereto, the several
financial institutions party hereto, and BANK OF AMERICA, N.A., as
administrative agent for the Lenders (in such capacity, the "Agent"). Terms used
but not otherwise defined herein shall have the meanings provided in the Credit
Agreement described below.

                                    RECITALS

                  The Company, the Subsidiary Guarantors party thereto, the
several financial institutions from time to time party thereto (each a "Lender"
and, collectively, the "Lenders") and the Agent are parties to a Credit
Agreement dated as of June 29, 2001, (as may be amended, modified, restated and
supplemented from time to time, the "Credit Agreement").

                  The Company, the Subsidiary Guarantors, the Required Lenders
and the Agent have agreed to deliver and execute this Amendment on the terms and
conditions set forth herein.

                                   AGREEMENT

         NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

                  SECTION 1  Amendment to Section 1.1. Section 1.1 to the Credit
Agreement is hereby amended by adding the following definition in the
appropriate alphabetical order:

                  "IRB Letters of Credit" means those certain irrevocable
                  Letters of Credit issued by Bank of America, as Issuing
                  Lender, in substitution of certain irrevocable letters of
                  credit issued by Bank One, NA (formerly known as The First
                  National Bank of Chicago) as more specifically set forth on
                  Schedule 8.1.

                  SECTION 2  Amendment to Section 2.2(a). Section 2.2(a) of the
Credit Agreement is hereby amended in its entirety to read as follows with the
additions and deletions set forth below:

                  (a)      Issuance. The Existing Letters of Credit have
                  previously been issued by the applicable Issuing Lender and
                  subject to the terms and conditions hereof and in reliance
                  upon the representations and warranties set forth herein,
                  Bank of America, in its capacity as an Issuing Lender, agrees
                  to issue, the applicable Issuing Lender agrees to renew,
                  extend and modify and each Lender with a Revolving Commitment
                  severally agrees to participate in the issuance by such
                  Issuing Lender of, standby Letters of Credit in Dollars from
                  time to time from the Closing Date until the date thirty (30)
                  days prior to the Maturity Date as the Borrower may request,
                  by delivering a Letter of Credit Application to the applicable
                  Issuing Lender; provided,

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                  however, that (i) the LOC Obligations outstanding shall not
                  exceed (x) in the case of the issuance of the IRB Letters of
                  Credit, ONE HUNDRED THIRTY MILLION DOLLARS ($130,000,000)
                  until such date that the IRB Letters of Credit are issued
                  hereunder and each letter of credit issued by Bank One, NA
                  as more specifically set forth on Schedule 8.1, has
                  terminated or been cancelled by the applicable trustee and
                  (y) at all other times ONE HUNDRED TEN MILLION DOLLARS
                  ($110,000,000); (the "LOC Committed Amount") and (ii) the
                  sum of the aggregate outstanding principal amount of
                  Revolving Loans plus LOC Obligations shall not at any time
                  exceed the Revolving Committed Amount. No Letter of Credit
                  shall (x) have an original expiry date more than one year
                  from the date of issuance, except as otherwise agreed to by
                  the applicable Issuing Lender (provided that any such Letter
                  of Credit may contain customary "evergreen" provisions
                  pursuant to which the expiry date is automatically extended
                  by a specific time period unless the applicable Issuing
                  Lender gives notice to the beneficiary of such Letter of
                  Credit at least a specified time period prior to the expiry
                  date then in effect) or (y) as originally issued or as
                  extended, have an expiry date extending beyond the date
                  thirty (30) days prior to the Maturity Date. Each Letter of
                  Credit shall comply with the related LOC Documents. The
                  issuance date of each Letter of Credit shall be a Business
                  Day. All Existing Letters of Credit shall be deemed to have
                  been issued pursuant hereto, and from and after the Closing
                  Date shall be subject to and governed by the terms and
                  conditions hereof.

                  SECTION 3  Conditions of Effectiveness. The effectiveness of
         this Amendment shall be subject to the satisfaction of each of the
         following conditions precedent:

                  (a)      This Amendment. The Agent shall have received a duly
executed counterpart of this Amendment from the Required Lenders and the
Company;

                  (b)      Representations and Warranties; No Default. As of the
date hereof, after giving effect to the Amendment contemplated hereby:

                  (i)      the representations and warranties contained in
         Section 6 shall be true and correct in all material respects on and as
         of the date hereof as though made on and as of such date; and

                  (ii)     no Event of Default shall have occurred and be
         continuing.

         SECTION 4  Representations and Warranties. Each of the Company and the
Subsidiary Guarantors hereby represents and warrants to the Lenders and the
Agent that:

                  (a)      It has taken all necessary action to authorize the
         execution, delivery and performance of this Amendment.

                  (b)      This Amendment has been duly executed and delivered
         by such Person and constitutes such Person's legal, valid and binding
         obligations, enforceable in accordance with its terms, except as such
         enforceability may be subject to (i) bankruptcy, insolvency,
         reorganization, fraudulent conveyance or transfer, moratorium or
         similar laws

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         affecting creditors' rights generally and (ii) general principles of
         equity (regardless of whether such enforceability is considered in a
         proceeding at law or in equity).

                  (c)      No consent, approval, authorization or order of, or
         filing, registration or qualification with, any court or governmental
         authority or third party is required in connection with the execution,
         delivery or performance by such Person of this Amendment.

                  (d)      The representations and warranties of the Credit
         Parties set forth in Section 6 of the Credit Agreement are, subject to
         the limitations set forth therein, true and correct in all material
         respects as of the date hereof (except for those which expressly relate
         to an earlier date).

                  (e)      Subsequent to the execution and delivery of this
         Amendment and after giving effect hereto, no Default or Event of
         Default exists under the Credit Agreement or any of the other Credit
         Documents.

                  (f)      All of the provisions of the Credit Documents, except
         as amended hereby, are in full force and effect.

                  SECTION 5         Miscellaneous.

                  (a)      Credit Agreement Otherwise Not Affected. Except as
expressly modified pursuant hereto, the Credit Agreement shall remain unchanged
and in full force and effect and is hereby ratified and confirmed in all
respects. The Lenders' and the Agent's execution and delivery of, or acceptance
of, this Amendment and any other documents and instruments in connection
herewith shall not be deemed to create a course of dealing or otherwise create
any express or implied duty by any of them to provide any other or further
amendments, consents or waivers in the future.

                  (b)      No Reliance. The Credit Parties hereby acknowledge
and confirm to the Agent and the Lenders that they are executing this Amendment
on the basis of its own investigation and for its own reasons without reliance
upon any agreement, representation, understanding or communication by or on
behalf of any other Person.

                  (c)      Costs and Expenses. The Company agrees to pay to the
Agent on demand its reasonable out-of-pocket costs and expenses, and the
reasonable fees and disbursements of its counsel, in connection with the
negotiation, preparation, execution and delivery of this Amendment and any other
documents to be delivered in connection herewith.

                  (d)      Binding Effect. This Amendment shall be binding upon,
inure to the benefit of and be enforceable by the Company, Subsidiary
Guarantors, the Agent and each Lender and their respective successors and
assigns.

                  (e)      Governing Law.  THIS AMENDMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

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                  (f)      Complete Agreement; Amendments. This Amendment
contains the entire and exclusive agreement of the parties hereto with reference
to the matters discussed herein. This Amendment supersedes all prior
commitments, drafts, communications, discussion and understandings, oral or
written, with respect thereto. This Amendment may not be modified, amended or
otherwise altered except in accordance with the terms of Section 11.3 of the
Credit Agreement.

                  (g)      Severability. Whenever possible, each provision of
this Amendment shall be interpreted in such manner as to be effective and valid
under all applicable laws and regulations. If, however, any provision of this
Amendment shall be prohibited by or invalid under any such law or regulation in
any jurisdiction, it shall, as to such jurisdiction, be deemed modified to
conform to the minimum requirements of such law or regulation, or, if for any
reason it is not deemed so modified, it shall be ineffective and invalid only
to the extent of such prohibition or invalidity without affecting the remaining
provisions of this Amendment, or the validity or effectiveness of such
provision in any other jurisdiction.

                  (h)      Counterparts/Telecopy. This Amendment may be executed
in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute but one and the same agreement.
Delivery of an executed counterpart by telecopy shall be effective as an
original and shall constitute a representation that an original will be
delivered.

                  (i)      Interpretation. This Amendment is the result of
negotiations between and have been reviewed by counsel to the Agent, the Credit
Parties and other parties, and are the product of all parties hereto.
Accordingly, this Amendment shall not be construed against any of the Lenders or
the Agent merely because of the Agent's or any Lender's involvement in the
preparation thereof.

                  (j)      Credit Document.  This Amendment shall constitute a
"Credit Document" under and for all purposes of the Credit Agreement and the
other Credit Documents.

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                  IN WITNESS WHEREOF, the parties hereto have duly executed this
Amendment, as of the date first above written.

BORROWER:                POTLATCH CORPORATION

                         By: __________________________
                         Name: ________________________
                         Title: _______________________

                        [signature pages continue]

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SUBSIDIARY
GUARANTORS:              DULUTH & NORTHEASTERN RAILROAD CO.

                         By: __________________________
                         Name: ________________________
                         Title: _______________________

                         THE PRESCOTT AND NORTHWESTERN
                         RAILROAD COMPANY

                         By: __________________________
                         Name: ________________________
                         Title: _______________________

                         ST. MARIES RIVER RAILROAD COMPANY

                         By: __________________________
                         Name: ________________________
                         Title: _______________________

                         WARREN AND SALINE RIVER RAILROAD
                         COMPANY

                         By: __________________________
                         Name: ________________________
                         Title: _______________________

                        [signature pages continue]

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AGENT:                   BANK OF AMERICA, N.A.,
                         in its capacity as Agent

                         By:
                         Name:
                         Title:

                        [signature pages continue]

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LENDERS:                 BANK OF AMERICA, N.A.
                         individually in its capacity as Lender and as
                         an Issuing Lender

                         By:
                         Name:
                         Title:

                        [signature pages continue]

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                         _________________________________
                         Lender

                         By:
                         Name:
                         Title:

                        [signature pages continue]

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