Paper Excellence Canada has announced it will not proceed with the planned restart of the Prince Albert pulp mill in Saskatchewan, citing unfavorable market and economic conditions.
The company is now exploring options to divest the facility.
The decision comes after extensive planning, engineering, and economic studies failed to produce a viable business case for the project. Paper Excellence cited weak market demand for unbleached kraft pulp (UKP), the primary product the mill would have produced, as a key factor in their decision.
According to the company, the UKP market is highly competitive, with lower-cost producers from other regions dominating the landscape. While prices are currently stable, the relatively small market size means that introducing additional capacity could potentially soften the market further.
Paper Excellence emphasized that this was a difficult decision made after careful consideration. The significant costs associated with the restart project could not be justified given the current market outlook.
Despite this setback, the company reaffirmed its commitment to operations in Saskatchewan. Paper Excellence highlighted its Meadow Lake Mill, which employs 200 people and generates $470 million in annual economic contributions, as an example of its ongoing presence in the province. The Meadow Lake facility produces Bleached Chemi-Thermo Mechanical Pulp (BCTMP) used in various paper products and packaging.
As Paper Excellence moves forward with exploring divestment options for the Prince Albert mill, the company expressed appreciation for the community's ongoing interest in the project. The future of the facility remains uncertain as potential buyers are sought.
TAPPI
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