Tolko Industries' mill in Kelowna, B.C., to close permanently Jan. 8

After months of job cuts and bad news, employees at Tolko Industries' Kelownamill learned on Friday themill will close permanently Jan. 8.

A total of 174 employees including 156 hourly and 18 salaried workers received severance notice.

In a statement from the company, vice-president Troy Connolly blamed the closure on high log prices which make the mill's products uncompetitive.

"We know our people in Kelowna have done everything in their power to make the mill successful," Connolly said. "They have gone above and beyond.

"Sadly, this has nothing to do with them or their efforts. Unfortunately, with B.C. log costs, the mill is no longer cost-competitive," he said.

The news comes with 127 employees at Tolko'sKelowna mill on indefinite layoff since August. Earlier in the year the company permanently eliminatedan entire second shift of 90 workers.

Union president Pat McGregor, said theUnited SteelworkersLocal 1-423was busy handlingquestions about severance pay details for theTolko employeesFriday. They also want to know ifthey can accessa $69-million B.C. government program recently created to aid job transition for Interior forest industry workers.

McGregorpredicted the mill closure will have a trickle-down effect on Kelowna's economy.

"We have good benefits plans so dentists will be affected. Doctors will be affected. It's quite a blow to the community," he said.

President and CEO Brad Thorlaksonsaid the permanent closure is a difficult decision for owners of the mill which has been in operation since the 1930s.

"Our thoughts are with impacted employees in Kelowna," Thorlakson said, adding they will be provided with detailed information on severance packages and benefits.

Where possible, employees will be offered positions at other Tolko locations or assistance incareer transition.

Thorlakson said the mill produced highly quality stud lumber for the North American and export markets.

The permanent closure of the Kelowna mill comes near the end of a year in which, according to provincial estimates, approximately 6,000 workers,25mills in 22 communities have been affected by closures, layoffs or shift reductions.