Nova Scotia court approves sale of paper mill for $33M
UARB approves discount power rate
After a year of legal wrangling, the $33-million sale of the former NewPage Port Hawkesbury paper mill to Vancouver-based Pacific West Commercial Corp. was officially sanctioned Thursday by the Nova Scotia Supreme Court.
Then later that day, the discount power rate requested by the future owner of the mill was approved by the Utility and Review Board.
Low cost electricity was a pre-condition for the sale.
Pacific West had to reapply after a negative tax ruling scuttled its previous arrangement with Nova Scotia Power.
Given all of the procedural steps that have yet to fall into place, the court also granted approval to extend the sale process to Oct. 5 if there are any last-minute glitches.
"We're hopeful that everything is in place," George Kinsman, a spokesman for court-appointed monitor Ernst & Young, said outside the Halifax courtroom.
"We are ready to go."
Kinsman said the sale's extension, the eighth so far, is "strictly precautionary."
However, the sale isn't expected to close until late Friday when the province, company officials and a battery of lawyers sign the closing documents in Halifax and Toronto.
"We didn't want to find ourselves ... not in a position to close and then looking for a judge," Kinsman added.
One of the last documents to be made public is the province's leasing agreement with Stern Partners on how much wood it can cut from Crown lands, a larger forest now that the government paid $20 million to purchase former NewPage lands.
That money went to Stern Partners.
John Traves, the province's top lawyer, said cabinet will issue a decision by the end of the week
"There will be a forestry utilization and licensing agreement that will be put in place," Traves said.
The terms will include the length of the Crown lease as well as the stumpage fees Stern will pay to the province in return for the wood to feed the mill.
Under a deal struck last Saturday, the province is offering a $124.5 million aid package on top of the $36.8 million it has spent keeping the mill in a so-called hot idle state.
Premier Darrell Dexter has said the agreement means the money the province has spent in an effort to restart the mill should be repaid in full in as little as 12 years.
In return, the company has promised to rehire about 300 workers and operate one of the mill's two paper machines.
The money-losing plant shut down last September, throwing about 600 people out of work and affecting another 400 forestry contractors.
At the time, NewPage cited the high value of the Canadian dollar and increased rates for shipping and electricity as the reasons for its closure.