Paper Excellence gets 6 more months of creditor protection for Northern Pulp mill

The owners of the idled Northern Pulp mill in Pictou County, N.S., have been granted another six months of protection from creditors.

British Columbia Supreme Court justice Shelley Fitzpatrick approved the extension to April 28, 2023, on Monday afternoon.

The case is being heard in B.C. because the mill's owner, Paper Excellence, is based in Metro Vancouver.

The Northern Pulp mill shut down in January 2020 after the Nova Scotia government closed the mill'sprovincially owned wastewater treatment facility at Boat Harbour, Pictou County.

Paper Excellence and the Province of Nova Scotia have been engaged in court-ordered mediation on multiple disputes arising from the mill closure.

"We are thankful that the court has approved our requests and that we can continue to work toward operating a new mill in Nova Scotia," Paper Excellence spokesperson Sean Lewis said in a statement to CBC News Monday.

The mill has been operating on money from its parent company since entering creditor protection in July 2020.The approval allows the company to spend an additional $7 million in debtor financing from its lenders during the extension period.

The company insists it is acting in good faith to restart the mill and in mediation talks.

In 2021 Paper Excellence launched a $450-million lawsuit against the provincewhich has accused the company of using creditor protection to fund the action.

The company has also objected to the terms of reference for the environmental assessment of its plans for a revamped operation.

Company needs quick renewal of water supply agreement

In a recent filing to the B.C. Supreme Court in support of extending creditor protection, mill general manager Bruce Chapman said the company needs a speedy renewal of a water supply agreement in order torestartthe operation. The deal would provide113 million litres of water a day to the mill.

"It is imperative that Northern Pulp negotiate a renewal of the water supply agreement in a timely manner," Chapman wrote on Oct.14.

Chapman also outlined the company's preferred timeline for an environmental review of its plans.

Plans for the next six months include spending more than $2 million to repair damage to the mill at Abercrombie Point, and its tree nursery, caused by post-tropical stormFiona.

There are no plans to make "special payments" to make up for a shortfall in the employee pension plan.

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