Paper Excellence finalizes purchase of idled pulp mill in Prince Albert, Saskatechewan, will invest more than C$200M to convert to dissolving pulp production, with startup by Q2 of 2012

Kendall Sinclair

REGINA, Saskatchewan , April 27, 2011 (press release) – The Prince Albert Pulp Mill is open for the first time in five years and moving toward a full restart of pulp operations.

Paper Excellence has finalized the company's purchase of a facility that has been shut since 2006, and that's welcome news for Energy and Resources Minister Bill Boyd.

"Paper Excellence is a valued member of the Saskatchewan forest industry," Boyd said. "The company's investment in Saskatchewan and the reopening of the mill mark a pivotal moment for the re-emergence of our forest industry in the new Saskatchewan."

"Saskatchewan has been a great place to operate with our mill in Meadow Lake," Paper Excellence's Canadian Vice-President of Operations Ed Roste said. "We are very excited to revive the Prince Albert Pulp Mill as part of our ongoing and long-term commitments to our forestry operations in Saskatchewan and Canada, and we thank the premier, the minister and the Saskatchewan government for their strong support."

The provincial government is committed to supporting the mill restart and has concluded all arrangements with Paper Excellence. Government commitments include provision of an adequate fibre supply, a clean biomass power purchase agreement with SaskPower, an agreement to maintain the existing environmental liability for a period of time when the mill operated as a Crown Corporation prior to 1986, and new pension plan agreements that respect the obligations to previous employees.

"The reopening of the pulp mill in Prince Albert is a great boost for our city and the entire region," Prince Albert Mayor Jim Scarrow said. "Prince Albert has long been the centre of the forest industry in Saskatchewan and the mill reopening re-establishes that leadership position for our city."

The government is also providing a letter of commitment for the $500,000 per year that it is allocating towards training of new mill operators in new mill processes during the mill's first two years of operation under its new owners.

Paper Excellence will be investing more than $200 million to convert the mill so that it can produce dissolving pulp. At least 200 direct jobs and hundreds of indirect jobs will be brought back to the community as the mill restarts.

Roste noted that Paper Excellence is embarking on an accelerated restart program with a targeted restart timeline of 12 months, ensuring that the mill is operational by the second quarter of 2012.

The company has begun hiring for key personnel in Prince Albert and its office will be fully operational within a week. Engineering contracts are being negotiated as are key equipment purchases.

The new timeline for restarting the mill will require major forest harvest activity no later than late fall this year. Roste said discussions are advancing well with industry and First Nations partners, government and a number of support operations.

Boyd noted the community of Prince Albert will see increasing activity throughout the year toward the restart date.

"This is a great day for Prince Albert and for the thousands of people who care about forestry in Saskatchewan," Boyd said.

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