Province slammed for sitting on mill mistake

The Newfoundland and Labrador government came under fire Tuesday for not disclosing it accidentally expropriated a defunct central Newfoundland paper mill until10 months afterit discovered the mistake.

"The government knew about this, as the minister says, in May of 2009 and yet they did not release any information," Liberal Leader Yvonne Jones said in the house of assembly.

The seizure was firstraised last Thursday in the legislature, when Deputy Premier Kathy Dunderdale said the government wound up with a century-old, environmentally troubled mill in Grand Falls-Windsor.

Shesaid the province is on the hook for what could be a multi-million dollar cleanup because it mistakenly expropriated a newsprint mill it doesn't want.

The error was made in a December 2008 bill that was rushed through the legislature, allowing the government to seize AbitibiBowater assets, particularly timber and water rights, as well a hydroelectric power station.

The government had thought it was saddling responsibility for decommissioning the mill on AbitibiBowater, which closed the facility after declaring it unprofitable.

Months later, in May 2009, the government found out it had accidentally seized the mill butrevealed nothing about the mistake that summer or through the fall.

Government officials say the province was trying to find a way to give the mill back, but with AbitibiBowater in creditor protection, federal bankruptcy laws made that impossible.

On Tuesday, Dunderdale referred the legislature to a statement the government issuedFeb. 5 about the seizure and insisted there was no cover-up.

"We didn't do it," she said. "We didn't do it. I announced this on Feb. 5, you know, and there was no untoward thinking around it, you know. We had the property. It was going to have to be disclosed. There was never a question of not disclosing."