Domtar Sells Prince Albert Pulp Mill to Paper Excellence

March 11, 2011 - Domtar announced that it has sold its pulp mill in Prince Albert, Saskatchewan, Canada to Paper Excellence.

The deal was announced on March 7 and local government officials welcomed the news.

"We're very pleased to see this deal come together," Premier Brad Wall said. "This project is great news, and it was achieved without the direct investment of taxpayers' money. It is further proof we have created the right business climate and a strong economy that attracts new investment, activity and jobs to Saskatchewan."

"I would like to thank both Domtar and Paper Excellence for all the work they have done to make this happen," Resources Minister Bill Boyd said. "Paper Excellence currently owns the Meadow Lake Mill, and they have an excellent track record in our province in terms of business leadership and environmental stewardship."

"This announcement helps secure the economic future for Prince Albert," Prince Albert Mayor Jim Scarrow said. "More than 200 direct jobs and many more in a revitalized forest industry. It is a truly great day for Prince Albert. Special recognition to our local MLA's Municipal Affairs Minister Darryl Hickie and Nadine Wilson for their part in making this happen."

Paper Excellence will be converting the mill so it can produce dissolving pulp for the production of a variety of products including rayon. They will be investing more than $200 million in the conversion of the mill and creating hundreds of construction jobs in addition to the projected 200 mill jobs. The conversion is expected to take between 18 and 24 months to complete.

Many groups have played a role in supporting this project including other industry players, The Communications, Energy and Paperworkers Union, the City of Prince Albert and our First Nations partners from The Agency Chiefs Tribal Council and Montreal Lake Cree Nation.

The Government of Saskatchewan has taken several steps in support of this mill restart. :

  • Direct allocation of 660,000 cubic metres of softwood pulp fibre from the Prince Albert Forest Management Area
  • Support for obtaining an additional 660,000 cubic metres of residual pulp fibre from existing sawlog allocation holders
  • The provision of a 2.5 million cubic metre softwood allocation in the form of a five year timber supply license
  • An agreement that will see SaskPower purchasing surplus electricity from a biomass power facility to be incorporated into the mill. That agreement calls for the purchase of biomass power at a price consistent with rates charged for this kind of project

In addition to maintaining the existing environmental liability for a period of time when the mill operated as a Crown corporation prior to 1986, the government will also ensure that new pension plan agreements will be in place that respect the obligations to previous employees.

Finally, $500,000 per year will be allocated for the first two years, to train new mill operators. Workers will need to be trained in new processes before working at the mill.

“This is an excellent example of what can be accomplished when government and industry work together, the creation of hundreds of jobs and the rebuilding of an economy,” Paper Excellence Canada Holdings Corporation Director Ed Roste said.

“We are pleased to continue both our investment in Canada and our investment in Saskatchewan and are grateful for the efforts of Premier Brad Wall, Minister Bill Boyd, the Government of Saskatchewan, and of course the true beneficiary of this announcement, the people of Prince Alber,” Roste added.

Paper Excellence also owns the Meadow Lake Mill in Saskatchewan.

SOURCE: Government of Saskatchewan