Nova Scotia’s provincial government announced yesterday it would contribute $124.5 million to re-open an idle paper mill in Port Hawkebury.
The NewPage mill closed nearly a year ago in September 2011. The multi-million dollar deal they have offered would help Pacific West Commercial Corp. – the owners of the mill – re-start and reinvigorate the facility and the workforce in the region.
“We have indeed done everything we can to keep this sector of our economy healthy, functioning and oriented toward the future,” Nova Scotia premier Darrel Dexter said during a press conference yesterday.
“Under the deal, Pacific West would receive a $40 million repayable loan for working capital to help the mill lower its costs and become more competitive, reported the Chronicle Herald. “The government has earmarked $26.5 million in forgivable loans to support improved productivity and efficiency at the mill, train workers and implement a marketing plan for Nova Scotia’s forestry sector. The province also plans to purchase a little over 20,000 hectares of land for $20 million, a sum that would go to the mill’s creditors. The funding package also sets aside $3.8 million a year for 10 years to support sustainable harvesting and forest land management.”
To date, the province’s NDP government has already spent over $31 million to maintain forestry activities in the Port Hawkebury area and to keep the mill idle since last September.
Despite the mill’s closure, plans also moved forward on a $200 million 60-megawatt biomass cogeneration plant on site.
In his announcement, Dexter said re-opening the mill will provide major benefits for Nova Scotia’s economy.
“He noted that the mill will represent 2.5 per cent of the province’s gross domestic product, support 1,400 jobs in the rural area and bolster provincial coffers through tax revenues of $11 million to $13 million a year,” reported the Chronicle Herald.
The deal, however, has yet to be finalized. The government needs a positive tax ruling from Canada Revenue Agency in order to go through with the offering.