The forestry industry is rebounding on
the north shore of Lake Superior.
The mothballed Terrace Bay pulp mill
has a new owner in the Aditya Birla Group of India.
Birla is a multi-national Fortune 500
corporation with employees in 36 countries.
According to the Times of India, the
purchase price was $300 million, but the report did not state whether
it was U.S. or Canadian dollars.
With rayon manufacturing operations in
India, Indonesia and Thailand, Birla is the world's largest maker of
viscose staple fibre. Birla Viscoe is used in a wide variety of
applications such as shirts, trousers, diapers, tissues, towels and
“It's a transformational move in the
forest sector and the first of its kind in Ontario,” said Thunder Bay-Superior North MPP Michael Gravelle, the province's natural
The Birla Group and a Canadian
subsidiary, the AV Group, operates two mills in New Brunswick and
supplies markets with specialty pulp products to service the textile
and paper industry.
The Terrace Bay property was under
creditor protection with Ernst & Young as its court-appointed
The mill was run by the Buchanan Group
of Thunder Bay, which purchased the operation from Neenah Paper in
2006. It has a paper grade pulp capacity of 285,000 tonnes.
Terrace Bay has not operated since an
explosion last October killed one employee, but plant improvements
were made under Ottawa's Green Transformation Program to attract a
As soon as the purchase agreement was
finalized in late June, the company immediately began work in making
$250 million in renovations to convert the mill into a
pulp-dissolving operation. A new five-year labour agreement was
reached with employees.
“The company are the customers
because they need it for the production of uniforms and material for
clothing,” said Gravelle. “This gives us a sense of long-term
sustainability for the operation that we haven't seen before.”
Under the Birla flag, the operation
will provide a minimum of 275 mill jobs, 335 woodland jobs, and offer
employment in countless support positions.
Among the many proposals for the
property that came forward, Gravelle said the Birla Group made the
best case of the mill's long-term viability and operation.
“A large investment by a global
company is something that we are excited about as a province.”
Gravelle paid credit to his cabinet
colleagues, particularly Government Services Minister Harinder Takhar
for helping build the province's relationship with the Birla Group.
The former Marathon Pulp mill is the
next good news story on the horizon.
A prospective new owner is an
Illinois-based development company specializing in buying and
repurposing brownfield sites across North America.
Although no announcement has been made
by the company or the Ontario government, the Green Investment Group Inc. (GIGI) was the leading candidate to close the deal on the
1,300-acre mill property.
The company, based just east of St.
Louis, in Alton, Ill., was founded and is co-owned by Ray Stillwell,
a Midwestern lawyer, and Mark Spizzo, a former economic development
officer for the State of Illinois.
“Due to confidentiality agreements in
place, we are unable to comment at this time,” said Stillwell by
email, who was in Marathon this past summer.
Gravelle also declined comment on the
Established in 2005, GIGI does
makeovers on abandoned industrial sites, then attracts a host of
synergistic companies. Its first project was the Alton Steel
redevelopment in its hometown.
The company's website lists seven of
its properties, including two in Quebec and one in New Brunswick.
The wood fibre basket on the north
shore will also be running under a different system next year.
Ontario has the established its first,
and much-anticipated, Local Forest Management Corporation (LFMC).
The Nawiinginokiima Forest Management
Corporation (Ojibway for working together) is a new government agency
assigned to manage and oversee the sale of timber. It is one of two
pilot programs previously announced by the province to test a new
forest tenure management system. Lac Seul First Nation, near Sioux
Lookout, was recently announced to be getting an Enhanced Shareholder
Sustainable Forest Licence.
Nawiinginokiima will manage the forest
management units of Nagagami, White River, Big Pic, Black River, and
the Pic River Ojibway forests. The units are in the vicinity of White
River, Pic River First Nation, Manitouwadge and Marathon.
Gravelle said he's committed to seeing
the corporation operating by next April and plans to put some startup
venture capital in place.
“We want to provide loans to the LFMC
to move into an operational position. In order for them to have a
real change of succeeding, they need to access loans, and we will be
in a position to do that.”
An interim board is currently in place
to select a general manager and eventually select a more permanent
board of directors.