Filed under: Pulp & Paper

Winning Bid will be announced January 20, 2012

by on Jan 11th, 2012

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Three months after the closure of the NewPage mill in Port Hawkesbury, NS, four companies interested in purchasing the shuttered mill are due to submit their final bids this week.

Though two of the bidders remain unnamed, the CBC says that Paper Excellence Canada and Stern Partners Inc. are the other parties who are vying for the mill and – should they win – are expected to maintain the mill as some sort of paper manufacturing facility. The two unnamed parties reportedly “plan to dismantle the plant and sell the equipment.”

Paper Excellence Canada recently purchased another mill in Nova Scotia, a northern pulp facility located in Pictou County. Stern currently owns a chain of newspapers and a part of Alberta Newsprint Co.

Should either of these companies win the bid, pulp and paper analyst Kevin Mason tells CBC that the provincial government would be expected to help reduce power costs as a condition for restarting the mill.

“Nobody can go in and just shovel away money at a losing asset. You’ve got to make some pretty good concessions to put this thing on a profitable footing to have a hope of survival going forward,” he says.

NewPage shut its doors in September saying it was losing money because of rising costs and the high value of the Canadian dollar.

Critics from around the Maritimes say that traditional pulp mills who find themselves in crisis mode can be saved pending a little adaptation of their products to suit the needs of new markets.

Mark Arsenault, executive director and CEO of New Brunswick’s Forest Products Association told the CBC
earlier this year that mills in his province have been actively seeking new techniques, new product developments and new innovations for years in order to maintain a strong presence in the Maritime forestry sector.

“AV Nackawic is making a dissolving pulp that’s being used for rayon and making clothing and that’s being shipped to India,” he said. “Twin Rivers, which is in Edmundston, is actually making a…higher grade paper that’s used in medical products and food packaging or in special labeling…so again a higher value product.”

Regardless of their immediate plans for NewPage, the winning bid will be announced no later than January 20, 2012.

SOURCES:
CBC: “Final Bids Due For NewPage Mill”
CBC: “Expert Says Innovation Saved New Brunswick Forestry”

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