$1-billion for pulp industry will benefit Harmac

Tony Gorman, Nanaimo News Bulletin
Published: Thursday, June 18, 2009

A $1-billion injection to create environmentally and economically sustainable pulp and paper producers can only benefit the industry, says Levi Sampson, president of Nanaimo Forest Products.

Sampson said the federal money will be allocated to 27 Canadian mills, including Harmac, which will help the employee-owned operation continue its effort to be successful.

"You've got to hand it to the Canadian government on this one," he said. "The U.S. black liquor subsidy forced the government's hand and they came through for what is best for the industry here."

The U.S. provided $8 billion in black liquor subsidies for pulp and paper mills. The $1 billion Canadian program will provide funding of 16 cents per litre of black liquor, which is a liquid by-product of the chemical pulping process used to generate renewable heat and power.

Harmac, along with other mills, will be required to use the money over the next three years in capital expenditures that will create improvements to energy efficiencies and environmental performance.

"By making a smart investment today, we are laying the ground work for a greener, more secure future for the pulp and paper sector and the people who work in it," said Minister of Natural Resources Lisa Raitt in a press release

Raitt added the money abides by the Softwood Lumber Agreement. Sampson said the program will provide enough funding for Harmac to accomplish its environmental goals. "At the end of the day, mills will burn less fuel and create less chemicals and be more efficient. That not only benefits the environment but the people working in the mills, the businesses themselves and the surrounding communities."

Harmac is also eligible to receive additional funding under the Canada Economic Action Plan, which is providing $170 million over two years to help companies develop new products and processes to capitalize on international markets.

Since reopening last year, Harmac has only been running one of three lines, which means some workers are still waiting to go back to work with Employment Insurance running out.

"It's a tough spot and market conditions will dictate when that second line starts up," said Sampson. "We have a lot of guys on the outside looking in."