The Ontario Ministry of the Environment, Conservation and Parks has fined AV Terrace Bay Inc. $525,000 following convictions for two violations of the province’s Environmental Protection Act.
The company was also ordered to pay a $131,250 victim fine surcharge, bringing the total penalty to $656,250, with 12 months to pay.
The charges stem from two separate environmental incidents that occurred in May 2023 at the company’s kraft pulp mill in Terrace Bay, located in northwestern Ontario. At the time, the mill was operational but has since entered a state of warm idle in January 2024 due to market conditions and financial constraints.
Effluent Toxicity Incident
On May 1, 2023, AV Terrace Bay failed an acute toxicity test mandated by its Environmental Compliance Approval (ECA). The mill's treated effluent, which is discharged into Lake Superior via Blackbird Creek, was tested using Rainbow Trout as indicator organisms. The ECA requires that no more than 50% of test fish die during monthly assessments; in this case, 100% mortality was recorded.
The company reported the failed test within the required timeframe and conducted follow-up testing weekly for four weeks, with no further exceedances. The ministry concluded the event appeared to be isolated.
Air Emission Exceedances
In a separate matter, AV Terrace Bay exceeded limits on Total Reduced Sulphur (TRS) emissions—compounds associated with odorous air pollution. Ontario’s technical standards for pulp and paper facilities prohibit TRS concentrations above 27 parts per billion more than twice in any six-month period.
According to the ministry, the mill breached this limit four times in May 2023. Each incident was promptly reported, and the company submitted an abatement plan following an internal investigation.
These violations led to an investigation by the ministry’s Environmental Investigations and Enforcement Branch, culminating in the March 14, 2025, convictions at a Thunder Bay court.
AV Terrace Bay Inc. operates a kraft pulp mill in Terrace Bay, Ontario. The facility has been idle since early 2024 and is currently in care and maintenance mode.
