Three years of negotiations between Resolute Forest Products and environmental groups aimed at protecting Canada's boreal forest have ended in failure, with talks breaking down over how much land to set aside for conservation.

Resolute (TSX: RFP) said Tuesday it could not accept a proposal from environmentalists that it says would have threatened thousands of jobs in remote communities.

"The final asks of the environmental organizations that were brought to us last evening were so extreme, were so draconian they would have forced the closure of multiple mills, multiple projects throughout Quebec and Ontario," said company spokesman Seth Kursman.

He said Resolute was disappointed that an agreement on a workable plan to balance conservation efforts with social and economic considerations could not be reached.

"What they were looking for was land withdrawal that far exceeded anything that we were willing to do because it was totally out of balance with the three guiding principles of sustainability," Kursman said.

Agreement would have been largest, most complex ever

Talks to reach a Canadian Boreal Forest Agreement began in 2010 after seven environmental organizations and 19 forest companies agreed to find a way to protect threatened woodland caribou while still giving companies access to 72 million hectares of public forests.

Greenpeace and the conservation coalition Canopy pulled out of talks last year, saying there has been nothing to show for the work since 2010.

The Forest Products Association of Canada had described the Canadian Boreal Forest Agreement (CBFA) as the largest and most complex deal of its kind.

The association said it regretted that environmental groups have suspended the talks with Resolute, but was pleased they remain committed to the overall agreement with the industry.

"Forest companies belonging to FPAC remain committed to the principles of the CBFA and want to continue the hard work necessary to protect the environment, including threatened species such as woodland caribou, while also protecting the forest products industry and the communities and jobs that depend on it," the association said.

Will work with other companies

Several environmental groups said the commitment to ongoing work with other forestry companies remained strong, despite the decision to suspend talks with Resolute.

"We are very pleased with the groundbreaking solutions for conservation we have forged under the CBFA with companies such as Tembec, Alberta Pacific Forest Industries and Millar Western Forest Products in northeastern Ontario and Alberta respectively," said Janet Sumner of the Canadian Parks and Wilderness Society.

The groups said they have suspended work with Resolute until it can commit to scientifically defensible conservation plans that would give caribou a reasonable chance of survival.

"We believe that Resolute is not meeting its commitments to ensure caribou survive on the forests it manages. In our opinion, it has so far proven itself unwilling to strike a balance between its economic interests and the local survival of a nationally threatened species," said Todd Paglia of Forest Ethics.

835,000 ha caribou conservation area proposed

Resolute said it made a series of proposals during intense final negotiations, including setting aside an additional 204,000 hectares of forest in northwestern Ontario for conservation.

That was on top of about two million hectares of Ontario forests that have already been protected over the last 15 years.

Resolute also agreed to protect 12 per cent or 692,000 hectares of Quebec forest, focusing on the best habitats for caribou conservation.

The two sides last year crafted a joint recommendation to government about establishing a caribou conservation area covering 835,000 hectares in northeastern Ontario.

Chief executive Richard Garneau said rural, northern and First Nations communities have paid "a heavy price from the economic and market challenges the industry has faced over the past decade."

He said the process did not involve "serious stakeholder consultations" and would have lacked "legitimacy."

"We agree that environmental concerns must be at the forefront. However, the regional social and economic impact must also be part of the equation," Garneau said in a news release.