News release via Canada NewsWire, Vancouver 604-669-7764
Attention Business Editors:
Catalyst announces permanent closure of Elk Falls mill
RICHMOND, BC, July 6 /CNW/ - Catalyst Paper (TSX:CTL) announced today
that it is permanently closing its Elk Falls paper mill near Campbell River,
British Columbia in September. This facility has been indefinitely curtailed
since February 2009.
"Today's news is a disappointing outcome for mill employees and families,
for the community, and for our business," said Catalyst President and CEO
Kevin J. Clarke. "The steep decline in commodity paper markets, coupled with
uncompetitive labour and tax costs were contributing factors that could not be
"Adaptation has always been the key to survival," Clarke noted, "and the
uncertainty regarding the future of this mill was detrimental to all our
operations and had to come to an end. With this difficult decision behind us,
we can now focus our sales and marketing strategies and production planning
around mills that still have the potential to operate competitively which is a
better basis to future-focus our business overall."
In a related decision, Catalyst also announced the permanent closure of
its paper recycling operation in Coquitlam, British Columbia. The facility,
which supplied the company's Crofton mill, was indefinitely idled in February
due to reduced recycled pulp requirements, combined with higher cost and
constrained availability of quality recovered paper. All employees were laid
off at the time.
The associated asset impairment charge, including severance costs, is
estimated at $302 million and will be reflected in the company's second
quarter results. Only a small number of employees will continue to be required
to manage and decommission the facility resulting in approximately 100 Elk
Falls employees being immediately impacted by the permanent closure.
The Elk Falls mill began operation in 1952, and at its peak, produced