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Thursday, August 28, 2014
Saskatchewan

CIC SELLS SASKFOR MACMILLAN INVESTMENT; CONSTRUCTION OF HUDSON BAY OSB MILL TO BEGIN IMMEDIATELY

Deputy Premier and Crown Investments Corporation Minister

Dwain Lingenfelter and Craig Neeser, Senior Vice-President of

MacMillan Bloedel Ltd., announced today that MacMillan Bloedel will

purchase Saskatchewan's 50 per cent interest in Saskfor MacMillan for

$80 million and that it will immediately begin construction of a $180

million oriented strand board (OSB) mill in Hudson Bay.



"These two announcements are very good news for Saskatchewan's economy

and for the future of our forest industry," Lingenfelter said. "The

sale of our investment will bring a significant financial gain to the

province, while MacMillan Bloedel's commitment to build a new OSB mill

will increase economic activity and create hundreds of jobs for people

in the Hudson Bay area."



The OSB project will create 150 jobs at the mill, 300 woodland jobs

and 300 jobs during peak construction. In addition, it is anticipated

that hundreds of indirect jobs will be created as a result of this new

development. The mill will be located four kilometres south of Hudson

Bay. It will have the capacity to produce 570 million square feet of

3/8 inch OSB annually. The consistency and quality of OSB is making

it a popular replacement for plywood in North America.



MacMillan Bloedel will continue to operate the three mills that

had been owned by Saskfor MacMillan a plywood mill and an OSB

mill in Hudson Bay and a sawmill at Carrot River. They employ

about 400 people and provide another 250 woodland jobs.



"Our partnership with MacMillan Bloedel over the past four years

has been very rewarding," Lingenfelter said. "Our three mills

have provided hundreds of jobs for local people and numerous

spinoffs for local businesses. The partnership has also been

profitable, returning $8.2 million in dividends to the province.

The sale of our interest will result in a gain of about

$30 million and the repayment in full of an $11.7 million loan."



Saskfor MacMillan was formed in 1995 as an equal partnership

between the Province of Saskatchewan and MacMillan Bloedel Ltd.

Each party contributed $50 million in equity, with Saskatchewan's

contribution coming from the assets of the former Saskatchewan

Forest Products Corporation.



"We have had an excellent relationship with the Province and the

people of Saskatchewan and we hope to continue it through our

commitment to the existing mills and the new OSB mill," Neeser

said. "We are particularly excited about the prospects for our

new state-of-the-art mill. The fibre resource in the area is

among the best on the continent and there's a huge untapped

market for the quality products we will produce. We believe we

will have a long and rewarding future with the people of Hudson

Bay and area."



The new mill and associated forest operations as outlined in the

company's 20-year forest management plan were both subject to the

province's Environmental Impact Assessment process.



As well, an integrated land use plan with full public and

stakeholder involvement was completed by government last summer.



"This new OSB mill is an exciting example of how we will be doing

more manufacturing in Saskatchewan by applying technology and

innovation to create marketable products," Economic and

Co-operative Development Minister Janice MacKinnon said. "We are

making better and smarter use of our forestry resource to create

jobs and opportunities while still preserving our precious

forests."



The OSB project is part of $850 million of private sector

investment in the forest industry in Saskatchewan that will

result in the creation of as many as 10,000 direct and indirect

jobs over the next three years. Additional jobs are expected in

manufacturing, agro-forestry and research and development.



"We are pleased and proud that MacMillan Bloedel's new OSB mill

will be part of the major expansion that is occurring in our

forest industry," Lingenfelter said. "The benefits will be

enormous, not only to the people and businesses of northern

Saskatchewan, but to the economy of the entire province."



Construction of the new OSB mill will take about 14 months.

Commercial production is expected to begin in August, 2000.



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For more information, contact:

Karen Schmidt

Crown Investments Corporation

Regina

Phone: (306) 787-5889



Steve Mitchell

MacMillan Bloedel Ltd.

Vancouver

Phone: (604) 661-8651
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