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REPORTING · 13th July 2010
Walter McFarlane
ON SAVING EUROCAN: PART 1

Just over 150 people flooded into the community room at Riverlodge on July 6th to listen to the presentation on the Eurocan Viability Study and the potential for the Mill. Rob Goffinet introduced the evening and greeted everyone and people were still coming through the doors as the meeting began.

Goffinet introduced the people at the front table and called the first speaker, Councillor Randy Halyk who has been one of the two members of Kitimat City Council working on the Eurocan Viability study.

“This is a very important evening and hopefully we can enlighten people,” said Halyk. “We’ve been working on trying to understand whether the Eurocan Mill is Viable from many months back.”

“What we have been looking at is a business proposal with will benefit all the regional forest industry and create jobs. This is a work in progress and it’s at a very high level,” said Halyk. “We want this mill to come back only if it’s viable.”

He explained they decided on a co-op to see if any workers would be interested in investing in the new mill. He said the group was formed by Council, the Unions, the Chamber of Commerce, Ministry of Forest, Rural Secretariat, BC Forest Coalition and Business Financial.

Halyk moved on to Poyry’s Viability study. The study was a review of the market and potential product lines. They looked at environmental concerns, the fibre supply and labour. Poyry put together a model under which the mill would be viable.

“’In previous model, mill net returns unable to support mill cost structure’” read Halyk. He explained the new mill: “Will run entirely on pulp logs with one machine, the sack craft machine. The mill used to produce linerboard and sack craft. The biggest portion of the mill’s product was the linerboard and it was determine that we could not be able to continue to make that with the economic conditions the way they are. As terms go, a smaller foot print using one machine to produce sack craft, which is what you put dogwood in or flour. Basically making sacks.”

He explained they were able to find a group which had lots of fibre, people who were harvesting pulp logs without being able to use them. With the new model, the people who make and ship the logs would be able to make money with the mill spreading money across the Sacred Circle. They would also be able to upgrade the docks.

Upgrading the docks would create a scenario for log exports. To be able to transport the logs without getting them wet. Halyk explained some ports do not accept logs which have been transported this way.

Now the group knows this is viable, the next step is to seek out investors. Poyry is looking for investors. A West Frasier is willing to listen to a substantial proposal from an investor. He asked anyone present to open their chequebooks and invest in the opportunity.

He reminded the people who attended the time is almost up. The deadline of the 15th of July was fast approaching and when it passes, West Frasier will start selling the assets. Halyk concluded the Eurocan Pulp and Paper would be cash positive if they chipped pulp logs. It would include forestry jobs, service jobs and reduce waste fibre.

He expressed they should not ship raw logs out of he country, they should manufacture them here but this would not happen overnight.

“This is a significant benefit to everyone in the region,” said Halyk.