'The mill is Corner Brook': Union, mayors throw support behind Kruger’s plan for Corner Brook mill

New project leaves unions, mayors feeling hope for the future of Corner Brook paper mill

Pelley, Kruger’s vice president of special projects, said people will find work and get to retire from Corner Brook Pulp and Paper. “It’s our investment to ensure the long-term future of this operation and all of our operations across the province,” Pelley said after he spoke at a Greater Corner Brook Board of Trade luncheon. It’s optimism that Monty Fudge welcomes.

“There’s been a fear of the mill closing for quite some time,” Fudge, a national representative with Unifor, told The Telegram on Wednesday, July 15. Fudge looks after all Unifor locals tied to Corner Brook Pulp and Paper and other Unifor locals in the province. Before he started that job in 2017, he worked in the mill for 18 years, and said that fear of closure existed even when he was hired in 1999.

“We’ve seen other mill closures in the province, and I guess we’re all hopeful to keep this one, at least have one mill left running in the province,” said Fudge. With the struggles the mill has seen, he said it’s nice to see some investment “And hopefully, everything works out and it becomes a profitable place again and a place where people can maybe grow some more jobs and keep the communities going with good-paying jobs,” he added. It’s something he thinks would be good for the whole forestry sector.

“If not, I know it would put a strain on the rest of the forest sector if the mill did shut down,” he said. He said the mill takes a lot of byproducts from the sawmills, and without that, they may feel a bigger pinch, which could have a negative impact on the industry as a whole. How will the plan extend the life of the mill?

Kruger plans to invest $700 million in its Newfoundland operation through Project Tuckamore — an investment that will be spread over four areas: the forestry operation, at the mill site, in a wind farm and in hydro generation. At the mill, the plan is to go from two paper-making machines to one and switch to using wood chips to make paper. The mill will get the chips from the sawmills, enabling them to produce more lumber from the larger logs.

Fudge said that’s huge. “They’re looking at harvesting more and putting out more wood to the sawmills and not handling raw logs at the mill, just pulp from the chips and products from the sawmill,” he said. Why is there a wind farm component?

The company also plans to build a wind farm to power the mill. Other wind farm projects in the province have met with controversy. “It is what it is,” said Fudge, adding that he’s not sure what to think.

“I’m glad to see some investment here. I know it’s not easy to see these things going up.” But he’s seen them in other provinces.

“I don’t know how well it’s going to be received, but the bottom line is, we’re using a lot of electricity. People are using more and more electricity, and there’s a demand for it, so somebody, I guess, has to produce that electricity. Hopefully, it all works out, and maybe it’s a good thing,” he adds.

Pelley said that Kruger’s wind farm differs from others that have been proposed in the province. “So, our wind farm is local energy for local jobs,” he pointed out. “This wind farm is going to supply the mill.

It’s going to supply jobs in the mill but also the forest sector. The scale of the wind farm is smaller than other projects. We’re looking between 17 to 22 towers, but it is wind energy that’s going to generate local economic development.”

The wind farm is also not meant to replace Deer Lake Power. Wind farm energy is variable, said Pelley, but Deer Lake Power has high-value, firm power. “So, Deer Lake being a hydro facility, as with our Watson’s generating station in Corner Brook and our co-generating facility at the mill, those are firm power, so on a day where there is no wind we still have that firm power capacity, and that’s high value for future growth in the province and the electrical grid,” said Pelley.

With the wind farm and improvements to its hydro facilities, he added, the mill will operate solely on renewable energy and will end its usage of oil. That means they’ll be removing the tank farm on Mount Bernard Avenue. Why the union is hoping for the best Fudge sat in on a seminar the company held and said they’ve got a lot of plans there, and it sounds like it makes sense.

“I can’t say it’s a bad plan,” he said. As for seeing the entire plan come to fruition, Fudge said the union and its members are hoping for the best. “We’ve been in talks with them for quite some time about different details around the plan and trying to get as much information as possible,” said Fudge.

He recognized that the company didn’t want to give too much detail when things were still in the planning stages. “So, we’ve been just trying to find out as much information as possible, like everyone else, and trying to ensure that it’s a good thing for our members, for the workers and for the community and surrounding areas was, I guess, our biggest concern,” he said. How many jobs could this mean?

Kruger is projecting a total of 1,000 jobs in the region, with 377 of those at the mill. That’s a decrease from the roughly 400 workers currently employed at the mill, however. Pelley said the decrease will happen through attrition and, in the future, the company hopes to be able to hire more people.

Fudge said people were uneasy about job losses prior to the project announcement. “So, to keep the remaining people there and do any cuts through attrition, we were glad to hear that. But again, we’re also hoping that the future will bring some new jobs, maybe some new opportunities for people, and hopefully, we’re not losing jobs, we’re growing some, hopefully, in the future,” said Fudge.

“We’re hoping to see that everything works out. We’re hoping for the best.” What will the project mean to Corner Brook and Deer Lake?

Two other people who are hoping for the best are the mayors of Corner Brook and Deer Lake, Linda Chaisson and Dean Ball. Both attended the board of trade luncheon. Chaisson said she first heard that the mill was going to be more secure than what was thought this time last year.

“It’s exciting news all around. It’s exciting news for the city. It’s exciting news for our surrounding areas, our communities that are involved,” said Chaisson.

Despite the downturn in newsprint production, Chaisson was pleased to hear Pelley say the project could result in jobs for decades to come and said she believes that is possible. “And I think when you sort of veer away from just focusing on newspaper, and we’re going to focus on other things, then I think we’re going to be fine,” she said. “The mill is Corner Brook,” Chaisson said, and it’s important to the future of the city.

“Without the mill, we are not going to be the same city,” she added. Talks of building wind farms have not been well received in other communities, but Chaisson said, “If that’s what it takes, then that’s what we’ve got to do.” She noted it still has to go through the environmental assessment process.

“They are laying a plan that is going to secure Corner Brook and surrounding areas,” said Chaisson. Ball agreed, calling Kruger’s plan a “game changer” for western Newfoundland. He said it was great news to see the investment the company will put in the communities in the region.

“I really think this is big news today,” said Ball. “This is a huge commitment. And we’ve seen the ups and downs in the logging industry and the woods, and we’ve rolled with those punches over the years, but I really think listening today on the plan, the action plan, and I really think it’s a bright future.

“I really think this is a doable project.” Ball said one of the ways Deer Lake will benefit is the investment in infrastructure in Deer Lake Power. “It’s labour, of course, we have the infrastructure, we have the water and that in itself is a huge piece of the puzzle.”

A puzzle made up of the four pieces in Kruger’s plan. “The four together works. You take out one piece of that, and it doesn’t work,” said Ball.

Part of the plan for Deer Lake includes the replacement of two penstocks on Main Dam. Ball said it’s the last two to be replaced, and that will help improve water flow and eliminate leakage. What will happen next?

Pelley said that there is a lot of work to be done over the next four years to bring the project to completion and that it won’t happen unless all four parts of the project go ahead. “All four are essential. Our forestry, the wind farm, the mill site and Deer Lake Power, our hydro, we need all four.

There is no plan B. We are not viable as we are now, and this project is our passport,” said Pelley. At a time when papermaking is on the decline, Pelley said investing in the mill is important.

“This place, we’ve been connected here since 1984. The mill has been in operation for literally 100 years,” said Pelley. “We’re connected to the forest industry in this province as well.

A thousand jobs, it’s very important, and for Kruger, the commitment is there to make sure that this business, Corner Brook Pulp and Paper and the forest sector, is viable for not just a year, but for decades to come.” Pelley said they will continue to supply newsprint customers for years to come. Future plans include more diversification in terms of the products produced at the mill.

“This project is all about our long-term commitment to the mill, our forestry and also Deer Lake Power. So, this project certainly makes us viable, makes us strong, puts us in a position for future growth,’’ said Pelley. What about the outstanding provincial loan?

It will also put the company in a position to repay the $110-million loan it received from the province in 2014. The loan was to be repaid in 59 quarterly payments of $1.85 million, starting in March 2014 and ending in December 2033. But the company has not made all its required payments.

Three years ago, the CBC reported that, with interest, the loan balance was at $117.2 million and growing Kruger also has a long-term power agreement that will see NL Hydro buy power from Deer Lake Power up to June 2027. Pelley said the agreement will continue as Project Tuckamore moves through construction. “That’s important to ensure that we’re viable in the short-term while we do the project.

In the future, certainly we’ll be different. We’ll be a different business. It’s something that is rooted in energy, is rooted in forestry and is rooted in papermaking, which will give us diverse revenue streams,” said Pelley.