Pulp and Paper Canada

News
Four Seasons Of Change


December 1, 2008
By Pulp & Paper Canada

WINTER

• Mumbai, India-based Aditya Birla invested $15 million in its Atholville, N. B. pulp plant, AV Cell. The company also increased its share holdings from 50% to 75%, as part of its production capacity expansion plans. The government of New Brunswick pledged a $17.3 million term loan to assist with the facility upgrades.

• The Socit de dveloppement conomique et industriel de Chandler (SDEIC) in Quebec and its partners accepted Vantek Inc.’s offer to purchase Papiers Gaspsia, the closed Chandler, Que.-based plant. The $40 million U. S. transaction allowed Vantek to buy the mill, which was to be dismantled, and all the equipment, which the buyer planned to sell. The city of Chandler retained the land.

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Cascades Inc. announced the sale of its coated fine papers manufacturing plant in Thunder Bay, Ont. to Thunder Bay Fine Papers. The plant had ceased operations in 2006 due to unfavourable economic conditions. Cascades Inc. contributed $4.5 million to the plant’s startup.

AbitibiBowater permanently closed its pulp and paper mill in Dalhousie, N. B. The company and the government of New Brunswick discussed a number of points relating to the closure, including ensuring the viability of the town and to help secure future employment for the mill workers affected by the closure. AbitibiBowater also agreed to only start dismantling the mill in September 2008, with the exception of the paper making equipment.

• Finland-based UPM announced the permanent closure of its Miramichi paper mill in New Brunswick. The mill had been temporarily shut down since August 2007. The closure was spurred by the strong Canadian dollar, which made the export of Miramichi paper to the United States unprofitable.

• A team of British Columbia and Alberta scientists launched a research project to study the interaction between the mountain pine beetle, the fungal pathogen it carries and pine trees. Genome British Columbia and Genome Alberta are funding the $4 million initial two-year project. In Alberta alone, over 1.5 million trees have been damaged by the pest. About 13 million hectares of forest have been devastated by the infestation in British Columbia.

SPRING

Cascades Inc. announced the integration of its North American boxboard operations with its Norampac container-board operations. With 2,950 employees, the boxboard group included four coated boxboard mills and 12 converting plants in North America. The consolidation means Norampac is now comprised of about 50 manufacturing and converting units and over 7,560 employees in the packaging sector.

Tembec Inc. sold a large portion of its stake in AV Nackawic and AV Cell – both in New Brunswick – to its partner, Aditya Birla Group. Tembec sold 20% of the 25% equity interest it held in the issued and outstanding shares in the capital stock of both facilities.

• With support from both the Conservatives and the Liberals, the House of Commons passed BillC-33, with a vote of 173 to 64. The senate later approved the bill. Under the amendments to the Canadian Environmental Protection Act (Bill C-33), gasoline will be required to have 5% renewable content, such as ethanol, by 2010. Diesel fuel will have to have 2% renewable content by 2012.

• The Quebec government announced its plan to protect over 18,000 square kilometres of forest and wetlands in 23 conservation areas across the province. The plan is part of Quebec’s earlier commitment to protect 8% of its natural spaces from development by the end of 2008 -an area which accounts for more than 1% of the province’s total area.

Summer

• According to a story published in the Edmonton Journal, the mountain pine beetle survived the winter in Alberta, despite harshly cold temperatures. While the cold did manage to eliminate many of the beetles in the northern part of the province, particularly near Whitecourt and Slave Lake, the article stated many of the beetles survived in numbers the government and researchers did not anticipate.

Catalyst Paper announced it was permanently closing its pulp mill near Campbell River, B. C. The closure, which was set to take effect in November, affected about half of the company’s Elk Falls workforce, with about 440 employees being laid off. Catalyst Paper was reported as citing a lack of sawdust as the closure’s cause.

Nanaimo Forest Products -a group made up of Harmac workers and private investors -purchased the former Pope & Talbot Harmac pulp mill in Nainaimo, B. C. The mill restarted and, in October, the Nanaimo Daily News, reported it was getting ready to ship its first batch of pulp in early November, mainly to markets in Asia and Europe.

Ontario launched a five-year biofibre policy in the hopes of giving the province’s forestry sector a boost. The plan will turn remaining treetops, branches and other unusable parts of the trees into energy. Targeted to a pallet wood sawmill and a cogeneration facility in Harcourt, a report by the Canadian Press stated the projects are being financed through a $1.56 million grant and a loan guarantee of $2.4 million. Policy supporters hope the plan will both reduce reliance on fossil fuels and promote economic development in Ontario. However, some environmentalists expressed concern the plan would encourage the unnecessary destruction of trees.

Aditya Birla Group’s AV Nackawic hardwood paper grade pulp mill in New Brunswick made a production shift to dissolving pulp. This material is used to manufacture viscose staple fibre, or rayon. The mill was scheduled to initially produce 190,000 tonnes of dissolving pulp to be sent to plants in India, Thailand, Indonesia and China.

• About 20 different worksites in New Brunswick were represented when members of the Communications, Energy and Paperworkers Union took to the streets near the border crossing in St. Leonard, N. B., demanding the federal government address the forest industry crisis that has been ravaging their communities. Similar demonstrations were organized throughout the country in 2008.

Autumn

• Edmonton, Alta.-based Worthington Industries Inc. purchased the former Pope & Talbot installation in Mackenzie, B. C., which had closed its doors after P&T went bankrupt in 2007. Worthington Industries had announced its plans to reopen the pulp mill in spring 2009, but then decided to go into a cold shutdown this winter. Dismayed Mackenzie municipal leaders and workers were quoted as saying they no longer trusted the mill’s new owners.

Norampac, a division of Cascades Inc., indefinitely closed its boxboard mill in Toronto, Ont., leaving 140 workers out of the job. The company cited high labour, fibre supply and energy costs as factors that contributed to the closure.

• The Canadian Corrugated Case Association and the Packaging Mills Association of Canada merged to form Paper Packaging Canada, a new national organization representing the interests of the players in Canada’s paper packaging industry. The Paper and Paperboard Packaging Environmental Council is the environmental arm of the new association, whose members include mills that produce paper and board for packaging grades, and converters who turn them into boxes, bags and cartons.

• Pulp shipments backed up in the Port of Vancouver due to credit concerns and shifts in demand in China. According to the National Post, only 25% of what was produced in British Columbia was being bought. According to the report, about 30% of B. C.’s pulp is shipped to China, with pulp shipments accounting for about one quarter of all trade for container lines that call on Vancouver.

Thunder Bay Fine Papers In
c.
(TBFP) was put up for sale following a Supreme Court hearing in Toronto, Ont. that saw the former Cascades Fine Papers Group Inc. mill be placed in receivership. According to a Canadian Press report, TBFP owes CIT Business Credit Canada $14.7 million The court appointed possession of the mill to Deloitte & Touche Inc., who were looking for a buyer with an interest in purchasing the mill’s operating assets. Although the mill had restarted in early 2008, a surplus of inventory and a lack of customers forced it to shut down in July.

Smurfit-Stone Container Corporation announced the permanent closure of its Pontiac pulp mill in Portage-du-Fort, Que., affecting about 218 employees. Smurfit-Stone president and CEO Steve Klinger said the closure was due to rapidly deteriorating conditions in the pulp market, which necessitated that the company take prompt action to avoid cash losses. The mill was scheduled to close on Oct. 31.

• Paper production and converting operations at Domtar’s Dryden, Ont. paper mill were scheduled to permanently cease as of mid-November. The company cited adverse economic conditions and low demand for fine papers as reasons behind the production curtailments. The shutdown of the Dryden mill’s papermachine and converting operations affects about 195 employees. PPC


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