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Travels with Larry Archive

Mackenzie Pulp Mill Restarted in British Columbia

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The Netherlands-based Paper Excellence division of Indonesia's Sinar Mas Group has re-started the Mackenzie, B.C., Canada, pulp mill formerly owned by Pope & Talbot (Portland, Ore., USA). The town of Mackenzie this past week held a celebration of the re-start, which has generated approximately 220 direct jobs, 500 indirect jobs, and will provide the local community with a significant economic uplift.

A single-line mill, Mackenzie has the capacity to produce some 235,000 metric tons of softwood market pulp annually, including sawdust based pulp and long fiber pulp. It was built in 1972 and was significantly modernized in 1996 with the addition of short fiber softwood digesting production capabilities.

Paper Excellence had first tried to acquire the Mackenzie mill out of bankruptcy in 2008 as part of a three-pulp mill (and a sawmill) $225 million deal that subsequently fell through. A company called Worthington Mackenzie bought the mill in late 2008. After that company walked away from obligations a month later, the provincial government assumed the $1 million a month maintenance costs to keep equipment from freezing in the winter. Several other attempts to acquire the facility failed before the final deal with Paper Excellence was negotiated.

For the re-start, the Canadian Ministry of Forests and Range played a key role in helping the Mackenzie pulp mill secure a new fiber supply, according to local newspaper reports. The ministry reached an economic development agreement with the McLeod Lake Indian Band that provides a five-year, 4 million m3 fiber supply opportunity for the mill. The Province is also investing $10.75 million for an improved road, connecting the communities of Mackenzie and Fort St. James, to ensure that logs and wood fiber for bioenergy can move more efficiently between the two communities.

Paper Excellence said in a newspaper report that it expects the Mackenzie operation will supply 80% of its product directly to affiliated mills in Asia, with the other 20% going to customers in North America.

 

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