Top stories of 2014: Operations shut down at pulp mill site

China accounts for 50 per cent of the world’s market in dissolving pulp and virtually the only growth market able to absorb the current capacity and the growing volume of capacity planned to come on-stream over the next few years.

Patterson remained positive that the mill would go back online. He said they were very determined to have full production at the mill in their 18-month timeframe. Unfortunately that would mean starting from scratch and changing their plan for what they would be producing.

“The tariff for Canadian companies that are operating in Canada range from zero per cent to 50 per cent, because Prince Albert has not yet started production the tariff on Prince Albert’s product going into China has been announced to be 50 per cent,” Patterson said.

In July of 2014, the City of Prince Albert was delivered some bad news in the form of a press release from Paper Excellence.

The company announced it would be shutting down its Green Energy Project until a startup date for the main part of the pulp mill could be decided upon.

While disappointed, Mayor Greg Dionne was not completely surprised by the news either.

“The quality of the fuel that they were using to produce Co-Gen (Generation) was not there because it was in the ground for too long and it decayed so it just wasn’t being profitable,” he said. “They are still negotiating with Domtar about the pulp side of it but those are confidential so they’ve decided to close all operations at the mill until they can start up the main plant.”

“What’s disappointing for us, is we want to see 2 to 300 people working out there so it’s disappointing for us because we’re not going to get that job growth right away,” he said.

All hopes of re-opening the mill now rests on the outcome of talks between Paper Excellence and the previous mill owner, Domtar.

At the time of the sale Paper Excellence agreed not to produce a product that would directly compete with Domtar. With the production of rayon seemingly going nowhere, Paper Excellence now wants to change the terms of the agreement.

A spokesperson for Paper Excelllence informed paNOW this month that talks were still ongoing and that the no-compete claus remained the huge stumbling block in talks.

Shane Vermette, executive director for the Ministry of the Economy, said the government had been following the talks, but is not actively involved.

“The government is not a party to that agreement; that is an agreement signed in good faith between the two companies. So it’s largely between the two companies to negotiate an agreement,” said Vermette.

In the meantime Vermette said the government will do its part through training initiatives and securing access to a cost effective supply of timber.

Mayor Greg Dionne said he has not heard anything new on the mill, and added the mill was not even on his radar until the competition clause is addressed.

At the time of the September news release by Paper Excellence, panow posted a poll question, asking if people thought the pulp mill would ever re-open. One hundred fifty people voted in our poll.

Only 16 per cent felt strongly that the mill would re-open, as opposed to 38 per cent would voted no. The third question asked if people thought the city should move on and look at another industry – 46 per cent clicked yes.

To read more top stories from 2014 click here.

nmaxwell@panow.com

On Twitter: @nigelmaxwell

by Nigel Maxwell

Top stories of 2014: Operations shut down at pulp mill site

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