Paper Mill Funding Returned After Restart Fails

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Paper Excellence Canada is returning $4.5 million to the province of British Columbia after failing to revive paper operations at the Catalyst Crofton mill.

The company had pledged nearly $50 million in early 2023 to restart the paper machine at the Catalyst Crofton mill, bringing back laid-off employees. However, a year later, those plans were scrapped, and paper production was indefinitely curtailed.

The returned funds were earmarked for retooling the paper line. Paper Excellence is also working on returning $14.3 million in federal funding previously announced.

The company says its focus at Crofton will now be on improving the cost-competitiveness of its remaining pulp operations, which employ roughly 400 people.

The B.C. government confirmed receiving the returned funds and expressed disappointment for the impacted workers and their families. They emphasized the need to support communities affected by challenging market conditions in the forestry sector.

Paper Excellence cites unfavourable market dynamics, rising costs for materials and energy, and a lack of domestic fiber supply as reasons for the failed restart. These factors, they claim, significantly impacted the financial viability of the papermaking operation.