Resolute CEO Garneau expects Fort Frances, Ontario, mill to be profitable with operation of remaining paper machine following indefinite closure of kraft mill, other paper machine

LOS ANGELES , December 4, 2012 () – Resolute Forest Products Inc. president Richard Garneau expects the company’s Fort Frances, Ontario, mill, to be profitable with its one remaining paper machine running, and that the recent indefinite idling of its kraft mill and the mill’s other paper machine does not mean the company is preparing to permanently close the mill, a local political representative was told, the Fort Frances Times reported on Dec. 3.

Thunder Bay-Rainy River MP John Rafferty made the comments after he and Kenora-Rainy River MPP Sarah Campbell met with Garneau and his advisor, John Valley, on Nov. 22.

Rafferty said Garneau and Valley explained the economics behind Resolute’s operations in Ontario and Quebec, which are now down to the one paper machine, PM No. 7 at Fort Frances, which is making money.

Rafferty said the meeting left him “cautiously optimistic” and he described Garneau as having “great hopes” for the Fort Frances mill.

On Nov. 20, Resolute announced the indefinite closure of its 200,000 tonnes/year northern bleached kraft (NBSK) pulp mill and its 105,000 tonnes/year groundwood specialty printing papers PM No. 5, both in Fort Frances, effective in late November. In its announcement, Resolute said it was exploring alternative product possibilities for the pulp mill, and that it would be idled in a manner that would protect the equipment.

Rafferty said Garneau dismissed rumors that Boise Inc. had offered to buy the Fort Frances mill. Boise operates a paper mill across the border, in International Falls, Minnesota, and had previously bought slush pulp from the Fort Frances operation. Boise instead now buys pulp from Boise’s Wallula, Washington, mill.

In its Nov. 20 announcement, Resolute said a factor in its decision to close the Fort Frances kraft mill was “the recent decision by a key customer to stop consuming the pulp supplied by Resolute to its mill,” which has the drying capacity of only 40% of its production capacity.

The Nov.20 meeting also involved discussions of Resolute’s operations in Thunder Bay, where the company has pulp and paper and sawmill operations, and Ignace, where the company owns a closed sawmill.

The primary source of this article is the Fort Frances Times, Fort Frances, Ontario, on Dec. 3, 2012.

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