The Province Purchases Bowater Lands

Premier Darrell Dexter announced on December 10 that the Province has negotiated an agreement with Resolute Forest Products and the Washington Post Company to purchase all Bowater Mersey shares for $1.

The province gains all of the company's assets, excluding the Oakhill Sawmill. The province takes compliance with the softwood lumber agreement seriously, and excluded the purchase of the Oakhill Sawmill on this basis. These key pieces of economic infrastructure will bring significant and lasting benefits to Nova Scotians and will cover the company's liabilities, including a fully funded pension plan.

In purchasing the shares of the company, the province now controls:

  • 555,000 acres of commercial and protected woodlands, including the Medway, Rossignol and St. Margaret's Bay districts. An independent evaluation pegs the land's fair market value at $117.7 million or $212 per acre. The land also presents more opportunities for forest-sector growth, including community forests. The province issued an expression of interest earlier today, and is exploring opportunities for a Mi'kmaw forest initiative with the Assembly of Nova Scotia Mi'kmaq Chiefs.

 

  • The former Bowater mill site in Brooklyn, Queen's Co., including bio-refining machines, valued at $5 million. The site will be transformed into a research, demonstration and development centre of excellence and innovation in cleaner energy, bioenergy and forestry products and technology.

 

  • Brooklyn Power Corp., a 30-megawatt biomass generating facility. The province will sell Brooklyn Power to Emera for $25 million in order to protect ratepayers from the termination of the current Power Purchase Agreement (PPA), which expires in 2025.

The value of the assets acquired by the province, including the woodlands, Brooklyn Power, the mill site and fibre inventory, cash and tax credits total $150.4 million. Total liabilities are $136.4 million, including $118.4 million of the company's assets funding the pension liability and severance, and the extinguishing of a portion of the company's debt at $18 million.