Douglas W. Judson
Resolute, Fort Frances at odds over sale of pulp mill
This article appeared in Pulp & Paper Canada. |
February 14, 2019 – Resolute Forest Products and the town of Fort Frances, Ontario are at odds over the pending sale of the town’s idle mill.
Tbnewswatch reports that Resolute issued a letter to Fort Frances mayor June Caul last week, saying it intends to sell the mill to a “community redeveloper” and that upon the transaction’s completion, the mill would be torn down.
The town of Fort Frances says this is in opposition to information they received in December 2018 about Resolute selling the mill to Repap Resources, a private investment company that would reopen the mill to produce sack kraft paper for packaging.
Before the deal with the community redeveloper closes, Resolute says it is still running a separate bidding process for other interested parties, who may put together binding offers for the purchase of the mill by March 15, 2019.
The catch, town officials tell Tbnewswatch, is that Resolute wants Repap or any interested buyer to sign what the company says is a “standard” a non-disclosure agreement (NDA) that would bar interested parties from involving the government in the sale.
That means a potential buyer would be unable to negotiate the forest management license owned by Resolute for access to the Crossroute Forest, which was the main source of fibre supply for the mill. The forest also currently supplies Resolute’s other operations in Northwestern Ontario.
Seth Kursman, VP communications for Resolute, says that Repap has already declined to sign the NDA, which means they can’t go any further in the process. Kursman told Tbnewswatch that Repap had created “unfair expectations” with the town in December when it confirmed it was in talks with Resolute about purchasing and reopening the mill.
Fort Frances councillor Douglas Judson has put forward a motion for the town council to pass a resolution criticizing Resolute’s handling of the situation, which will be debated Tuesday, February 19.
Resolute has responded with threat of legal action, saying the council is making defamatory statements and should not be negotiating a contract in public that may affect the sale.
The town’s wording in the resolution remains unchanged.
Read the full story here.