Gaspsia suspends work
February 10, 2004 By Pulp & Paper Canada
Construction work at the Chandler paper mill halted after Papiers Gaspsia announced it has asked for court protect…
Construction work at the Chandler paper mill halted after Papiers Gaspsia announced it has asked for court protection from its creditors in the absence of an agreement among its three shareholders on a $200-million refinancing package.
Installation is taking longer than expected and the costs continue to soar. The total cost of the mill is now estimated at $700 million. So far, $300 million has been spent out of the original $500 million budget.
On Feb. 2, around 650 construction workers stopped working on the project to convert the former newsprint mill to produce quality coated paper.
Tembec holds a 25% stake in the mill, while SGF, the Quebec government’s investment arm, owns 25%. The Quebec Federation of Labour’s Solidarity Fund owns the remaining 50% stake.
SGF agreed to add $50 million and refused to go beyond that amount. The Solidarity Fund agreed to add $65 million out of the $100 million that the Quebec government demanded. Tembec is not commenting while negotiations are still on-going.
Print this page