Thunder Bay

Could Resolute keep its logging rights near Fort Frances without a mill? Expert says it's possible

With Resolute Forest Products saying it wants to decommission and redevelop its mill property in Fort Frances, Ont., an expert in environmental policy says the forestry giant could still keep its logging rights to the nearby Crossroute Forest even without a plant in the northwestern Ontario town.

Forest licence for Crossroute Forest up for renewal in the next few years, province to seek input

Resolute Forest Products holds the rights to harvest the Crossroute Forest near Fort Frances. Its licence says the wood is to supply operations in Fort Frances. The company says it's looking to decommission its mill there. (CBC)

With Resolute Forest Products saying it wants to decommission and redevelop its mill property in Fort Frances, Ont., an expert in environmental policy says the forestry giant could still keep its logging rights to the nearby Crossroute Forest even without a plant in the northwestern Ontario town.

That comes as Resolute's sustainable forestry licence for the Crossroute Forest is set to expire in 2022. The planning process for new licences, including gathering public input, typically starts a couple of years ahead of time.

The province has said it's committed to ensuring that any potential new forestry operators in the market have the wood fibre available to go into business. Conservative Kenora-Rainy River MPP Greg Rickford said, with the licence renewals looming, the government will "be looking to support the prospect of any new market entrant coming in and using a forest that the community rightly considers to be its own."

Resolute's current forestry licence for the Crossroute Forest states that the wood harvested is to be used for the "existing forest resource processing facility ... located at Fort Frances, Ontario." The mill closed in 2014. At least one previous potential deal for the property also fell through.

But when the time comes for licence renewal, the company can argue that the wood is needed for its other operations in the northwest, said Warren Mabee, the director of the Queen's University Institute for Energy and Environmental Policy.

"They will probably have a clear idea of what they want to do with the ... wood that's under the licence," he said. "They have to make that case to the government, though, and occasionally the government does decide that the plan that the company's putting forward isn't going to provide enough direct benefit or local benefit."
The Resolute mill in Fort Frances was closed in 2014. (Jeff Walters/CBC)

In a letter to Fort Frances Mayor June Caul, Resolute President Yves Laflamme said that the company [wants] the regional economy to prosper."

Company vice-president Seth Kursman, in an email to CBC News, said Resolute, as well as other companies, "remains concerned about access to a cost-competitive fibre supply for our operations."

On Monday, Resolute turned down a bid from another company, Repap Resources Group, that the latter company said would lead to the mill being restarted. Resolute said Repap's bid "fell short on multiple fronts," including not putting up a financial deposit, not producing sufficient financing and not addressing a requirement over environmental remediation.

CBC News has yet to receive comment from Repap president Sean Twomey since his bid was rejected.

Rickford has insisted that the mill, in whole or in part, could still be restarted if Repap or another company can work out an agreement with the redeveloper that Resolute's been in talks with and that appears poised to take over the property. Kursman has also acknowledged that's a possibility.

But even if the site is razed for redevelopment, Mabee said that Resolute can use the prospect of supporting jobs elsewhere in northwestern Ontario to keep its rights in the Crossroute Forest.

"The big thing the government will take into account as companies go through these types of changes is 'what does it do to employment and is this wood being used to support employment in the local region?'"

Employment doesn't have to be a mill

Mabee said, while the government's focus will likely be on trying to do what it can to see a mill return to Fort Frances, forest licences can be used by a wide variety of other businesses.

"It could be a bio-energy company, it could be a new pulp and paper concern ... it might be somebody who has a really innovative idea for the wood: they're going to make some kind of chemical or glue or something like that," he said. "There are any number of different ideas out there and different business prospects."

"It sounds like the government would like to see to hear from some of them."

Still, he acknowledged that it's not common for large forestry companies to lose a licence.

"They have a very long-term plan in mind in terms of what they plan to do with their mills, what they plan to do with their infrastructure."

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