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20 Companies Pass on Closed Abitibi Mill in Stephenville

Aug. 9, 2006 (AP) - The Newfoundland government has failed in its bid to sell Stephenville's Abitibi-Consolidated paper mill, shut down eight months ago amid company complaints about weak markets and soaring costs.

More than 20 companies were approached, but all said they weren't interested, Newfoundland's natural resources minister confirmed Wednesday.

Kathy Dunderdale said the lack of interest is symptomatic of the poor shape of Canada's pulp and paper industry and the bleak future that lies ahead for some single-industry towns.

"Unfortunately, it doesn't seem to be very bright," Dunderdale said. "We haven't done a really good job in Newfoundland and Labrador in the past of diversifying our economy."

Abitibi closed the mill in December, laying off 300 workers and delivering a severe blow to the west coast town of 7,000.

"(It) certainly makes you kind of relive the feelings that you had the day that the announcement to close the mill was made," Stephenville Mayor Tom O'Brien said. "It doesn't come as a surprise to us. It's something that we would prefer not to be happening, but that's the reality we have to face."

The news also came as no surprise to some former workers, who were convinced the mill would never reopen when the company began issuing severance packages.

Over the past year, Abitibi-Consolidated also closed mills in Ontario and Quebec, because of soaring energy costs, the rising Canadian dollar and a gradual drop in newsprint consumption throughout North America.

SOURCE: Associated Press

See related story:
- Abitibi-Consolidated Applies to Tear-Down Stephenville Mill (08/09)
(The Western Star)




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