Paper Excellence Canada, NS Agreed to Drop Pictou Mill Reopening Plan

In case, the review process suggests that a new mill is not feasible, the assets of the Northern Pulp group in the province will be sold in a managed process.

SEATTLE (Scrap Monster): Paper Excellence Canada has reached a settlement agreement with the province of Nova Scotia to not proceed with the plans to reopen Northern Pulp Nova Scotia in Pictou. The bilateral agreement is subject to approval by the provincial Supreme Court.

The two parties have agreed to conduct a review process on determining the viability of a new, modern mill in Liverpool, Nova Scotia. The review process will be funded by Paper Excellence Canada. The possibilities of constructi Northern Bleached Softwood Kraft (NBSK) pulp mill is dependent on the verdict of the study.

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If the new mill is found feasible, the company will seek financing support from third parties towards its design, construction and operation. In addition, the company will pay $15 million to the province towards full settlement of the previous woodlands-related debt, the company press release said.

In case, the review process suggests that a new mill is not feasible, the assets of the Northern Pulp group in the province will be sold in a managed process. The sale proceeds will be mainly used towards repayment of the debtor-in-possession financing.

Furthermore, the agreement calls for settlement of outstanding litigation and loans and also to address the long-pending issue of pensions of former mill employees.

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