Provincial Government Announces Agreement with Corner Brook Pulp and Paper Limited

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The Government of Newfoundland and Labrador today announced that it has entered into an agreement to purchase additional power to further support the electricity grid, and to help stabilize Corner Brook Pulp and Paper Limited (CBPP), its workers and the forestry industry during challenging conditions in the global newsprint market while the company explores diversification opportunities.

The six-month agreement includes Newfoundland and Labrador Hydro (Hydro) purchasing excess green energy from CBPP’s Deer Lake Power assets. In turn, CBPP will work to identify new revenue sources from viable wood-based bioproducts projects in order to unlock Newfoundland and Labrador’s high forest potential while further stabilizing the mill’s sustainability and future.

A new agreement between CBPP and Hydro for energy generated from CBPP’s existing power generation facilities will provide flexibility for Hydro to draw upon when needed. There is no impact on the ratepayer as a result of the agreement.

In addition, the Provincial Government and CBPP have reached an agreement with respect to security, workforce and diversification. CBPP has committed to offer for sale saw logs to the three large sawmills in line with CBPP annual operating plans submitted to the Department of Fisheries, Forestry, and Agriculture. These saw log sales are essential for the stability of the forest sector.

The Provincial Government remains optimistic about the forestry industry and continues to have ongoing discussions with CBPP.

CBPP is the only newsprint mill in the province and, according to Statistics Canada, contributed $49.9 million to the provincial GDP in 2020. CBPP operates two paper machines producing 240,000 tonnes annually with a sales value of ~$130 million and paper production directly employees about 305 workers.

CBPP consumes about 450,000 cubic meters of wood per year and employs a further approximately 80 staff in forest management and harvesting. Sale of saw logs to mills supports the lumber sector and generates revenue for CBPP.

“Our government supports the sustainability of Corner Brook Pulp and Paper Limited and its role in the integrated forest sector in the Province. We will continue to work together to secure the future of our forest industry for the benefit of the residents and communities throughout the western region and our entire province.”
Honourable Elvis Loveless
Minister of Fisheries, Forestry and Agriculture

“We understand that Corner Brook Pulp and Paper Limited has been challenged due to a difficult business environment in the newsprint sector. We encourage the company to explore options to complement its product line so it can continue contributing to the forestry industry in Newfoundland and Labrador.”
Honourable Siobhan Coady
Minister of Finance

“Through this agreement, Newfoundland and Labrador Hydro will increase its excess energy reserves which are beneficial especially during winter months. This will help maintain CBPP operations and employment as the company explores opportunities for long term sustainability for employees of the mill and the forestry industry.”
Honourable Andrew Parsons, KC
Minister of Industry, Energy and Technology

“Corner Brook Pulp and Paper Limited plays an important role in my district, and as the area MHA, I am pleased to be part of a government that recognizes the significance of the forestry industry and the hard-working people who rely on it. I remain committed to standing with the workers as the company adapts to these challenging market conditions.”
Honourable Gerry Byrne
Minister of Immigration, Population Growth and Skills and MHA for Corner Brook

Source: Government of Newfoundland and Labrador