Province pushes back against claims it isn’t doing enough to secure local wood supply

Minister of Energy and Resources Bronwyn Eyre says province can't break existing wood supply contracts, says proposed project has received a timber allocation

BC-based Carrier Lumber will be resubmitting new harvesting plans for the 21-22 fiscal year. Photo courtesy of Ministry of Environment

The provincial government is pushing back against accusations that it isn’t doing enough to ensure an adequate wood supply for proposed local projects.

Minister of Energy and Resources Bronwyn Eyre told the Herald that it has allocated some wood to one proposed project, but its hands are tied for other area allocations as they are caught up in existing contracts that shouldn’t be broken.

Eyre’s comments come a week after Coun. Don Cody asked during a public council meeting where the wood was for local manufacturers who have opened or are pursuing opportunities in the area.

Cody said the OSB mill’s investors — who still haven’t been identified publicly — have been asking since at least December for movement on this file.

“We’re into June next week,” he said last Tuesday. ‘Still no wood supply for the OSB mill. Where is our wood?”

As Cody spoke, other councillors banged on their desks and called out “Shame” and “where is it.”

Cody said it’s not just an issue the OSB mill is facing. He said Pivot Subscriptions, which operates a furniture assembly plant in the area, is having to import its wood supply from Manitoba, Alberta and Minnesota.

Eyre also responded to comments from NDP jobs critic Aleana Young. Young, who had tweeted about the issue, told the Herald that the wood supply “shouldn’t be a partisan issue,” but instead “a common-sense issue.”

“Pounding desks and chanting ‘where’s our wood’ is one approach,” Eyre said Tuesday.

“Pretending this is a partisan issue is another approach that makes zero sense. There are steps to these things. There are legal steps, environmental procedures that have to be gone through to ensure that the allocation process is fair as possible based on the wood available.”

She said there are business plans and environmental plans that have to be filed and formal allocation requests made.

‘All companies have to be treated equally and fairly in Saskatchewan,” she said.

She went on to say that Paper Excellence, which owns the Prince Albert Paper Mill, has a conditional timber allocation that was provided in 2018 and is set to expire this year. That allocation, she said, was to support the potential reopening of the mill. Despite comments made by other parties to the contrary, that allocation, she said, was for hard and softwood.

“That allocation runs out this December,” she said.

“It’s contingent on Paper Excellence reopening the mill. But that temporary allocation is a contract. I assume that mayor and council and … everyone who’s weighing in suggesting that we break that contract with Paper Excellence has to understand that was entered into in good faith when forestry was not booming the way it is today. Governments can’t be in the business of breaking contracts. We can’t create an investment climate where that happens. I’ve made no secret of that.”

Eyre said she spoke to the mayor “a number of times” and that he’s well aware of the contractual timber allocation and the province’s obligations.

“Yet,” Eyre said. “There continues to be this suggestion that we break the contract, which is unreasonable.”

Nothing precludes any company from trading timber through commercial agreements to ensure that allocations are fully utilized, Eyre said.

In a written statement, Paper Excellence said it’s working with a variety of stakeholders, including the provincial government, to support the restart of the mill.

‘We look forward to the day when the site can employ 200 people creating over $300 million per year in economic benefits for Prince Alert and all Saskatchewan,” read the statement, attributed to Graham Kissack, vice president EH&S and Corporate Communications.

Eyre said she’s been in constant contact with local MLAs and the projects impacted — both the proposed sites and the existing operations, such as Paper Excellence and Pivot Subscriptions.

Pivot, which manufactures furniture to be rented and then repurposed and reused, was mentioned at city council, but has not responded to a request for comment.

Eyre indicated one of the other companies in discussion in the region is One Sky Forest Products. She told the Herald that she’s been in constant contact with its CEO and one of its board members.

“We provided One Sky with a timber allocation of wood that we had,” Eyre said.

“We’ve done what we could to further things along based on what we have available in terms of timber allocation.”

During last week’s meeting, Dionne said a local component hoping to open an OSB mill had been promised a wood allocation but had not been provided a letter from the province confirming that allocation. That letter, he said, is needed to start pouring cement for a mill foundation.

Eyre said the government wants those “workable projects” to “move forward and thrive.”

“We want the jobs in PA and area. My MLA colleagues want the jobs in PA, and I think it’s very important that the people of PA and the region know that our commitment to PA is clear. Our commitment to growth is clear through the announcements we’ve made on the hospital, on the economic enhancement program, on the arenas and aquatic rec centre — we know PA can accomplish great things and we’re right behind them,” she said.

“These projects are a big part of that. But there is a process, in terms of something as important as contracts, which has to be also remembered here.”

Eyre said a lot of work goes on in her ministry and in the Ministry of Environment to “get the right log to the right mill” and to maximize the utilization of lumber in the province.

She stressed that at the time Paper Excellence was granted its timber allocation, the forestry industry was in a different situation, and these other companies weren’t on the horizon.

“We entered into this in the hope that the PA mill would reopen. Paper Excellence is a global company. It’s made some significant investments and investment announcements for PA and the mill this year, which has been very welcomed,” Eyre said.

In February, Paper Excellence announced an investment of more than $600,000 in engineering and consulting work focused on restarting the mill “as soon as possible.”

Kissack said at the time that, if all goes well, that could mean summer 2023.

“We’re heartened to see the investments that Paper Excellence has made, and we’re heartened to see the interest in the sector. Ensuring a thriving forestry sector is good for everybody,” Eyre said.

“In the growth plan that we released in 2019, we said explicitly that we want to double the size of the forestry sector. We take all of that very, very seriously.”

Who is One Sky Forest Products?

Eyre named One Sky as one of the companies looking to set up shop in the region. One Sky has not been named publicly by council, but its website lists it as operating in the Prince Albert area and planning to open an OSB Mill.

Their website proclaims “OSB Made in Saskatchewan” in a large banner across the top of the page.

“One Sky Forest Products will be offering best-in-class OSB products starting in Q1 of 2022,” the website says.

“Located near the dense and productive forests of Prince Albert Saskatchewan, our goal is to meet global market demands through strategic partnerships, competitive pricing and the optimization of forest lands.”

The company says they will create over 700 jobs in northern Saskatchewan.

Dionne had announced an unnamed forestry project creating 700 jobs targeting the area prior to last year’s municipal election. Council, and the regional development agency, have both also said a biomass manufacturer is planning to open in the area, possibly in or near Shellbrook.

On its website, One Sky says it plans to begin fabrication of oriented strand board (OSB) at a Prince Albert facility with a volume of 600 MMsf/yr of traditional performance-rated sheathing, and expand in its second year into multi-sized, radiant barrier sheathing and tongue-and-groove sub-flooring. A graphic also indicates interest in I-joist components and biofuel as a by-product.

OSB is used as a structural panel in construction, and also has uses in furniture production.

One Sky’s website commits to partnering with First Nations, providing quality OSB, designing and operating a facility with a low carbon footprint.

“Getting the right log to the right mill opens partnerships with existing forest-based companies and creates ‘win-win’ scenarios,” they say.

The company lists experienced forestry and financial executives among its executive leadership team, including Erik Munk, a former director of Global Project Development for Wood products at Stantec and CEO Brian Baarda, whose bio boasts of a 30-plus year career in the forest industry, including a tenure at Paper Excellence.

The company lists its partners as Montreal Lake Business Ventures, Wahpeton Dakota Developments and Meadow Lake Tribal Council (MLTC).

According to the website, MLTC and the Big River First Nation have partnered together to form a group of ten Frist nations to invest and become shareholders in One Sky Forest Products.

One Sky lists a PO box in Prince Albert as its mailing address.

The company didn’t respond to requests for comment sent through their website, nor through Robert Fincati, a member of their board of directors who also serves as CEO of Montreal Lake Business Ventures and Wahpeton Dakota Developments.