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AbitibiBowater seeks legal action


December 16, 2008
By Pulp & Paper Canada

Legislation that sanctioned the government’s expropriation of AbitibiBowater’s assets in Newfoundland h…

Legislation that sanctioned the government’s expropriation of AbitibiBowater’s assets in Newfoundland have prompted the company to consider legal action, CBC reported. The company has requested the province establish a joint working group to go over all the issues associated with the closure of the Grand Falls-Windsor mill, the story confirmed.

The provincial government passed legislation this week permitting the expropriation of the company’s hydroelectricity rights from the generating station at Star Lake, in addition to all of its timber rights to forests on Crown land. These assets will now be run by the province’s own energy company, Nalcor, CBC reported. Premier Danny Williams said the government is proceeding this way because of AbitibiBowater’s decision to close down its mill.

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“For a hundred years, Abitibi and its predecessors enjoyed the privilege of Newfoundland and Labrador’s natural resources,” CBC reported Williams as saying. “It simply makes sense if Abitibi are not going to continue the operation of the pulp and paper mill and renege on their commitment to our province, they will no longer have access to our natural resources.”

The company says it will consider the possibility of working with the government to resolve the issue, but is investigating whether or not international trade rules have been broken.

 


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