Powell River mayor dismayed by company's decision to list paper mill with real estate firm - Action News
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British Columbia

Powell River mayor dismayed by company's decision to list paper mill with real estate firm

The mayor of Powell River says the company running the local Catalyst paper mill has betrayed its working relationship with the city, after it listed the mill site for sale worldwide.

Mayor Dave Formosa says he feels like the mill has pulled the rug out from under the community

After years of tax breaks to the mill worth millions, Powell River Mayor Dave Formosa says he is left wondering where is the goodwill. (City of Powell River/Facebook)

The mayor of Powell River says he was "shocked" to learn that the corporate ownerof the city's pulp and paper millhas listed the property with a global real estate firm, despite collaborating with the community for months onthe search for aclimate-friendly successor.

Dave Formosa said after months of discussion between Catalyst Tis'kwat mill owner Paper Excellence, the province and Renewable Hydrogen Canadawhich produces cleanfuels like hydrogen and methanolPaper Excellence led him to believe the hydrogen company "would be a great fit" to take over the property.

He said he expected the mill would return the "goodwill" after the city gave it tax breaks worthmillions of dollars over the last 14 years in order to keep it running.

"We're concerned about climate change issues ... about having a good corporate citizen for our community about good-paying jobs ... about our tax base," Formosa said, adding he wantedthe company to have thecity's best climate and economicinterests at heart.

"I feel the rug was pulled," he said. "This was not in good taste or in good colour."

The millannounced an indefinite curtailment last December, due to ongoing financial losses, and said around 200 workers would be temporarily laid off until the company decidedwhether it wantedto continue running the mill in a different capacityor sell it altogether.

Listingis part of 'due diligence,'company says

Graham Kissack, vice-president of corporatecommunications for Paper Excellence, told CBC the company's decision to list with real estate firm Colliers was "part of our bigger due diligence process" in determining the site's future.

Kissack saidwhile there have been many discussions with Renewable Hydrogen Canada over the potential purchase of the site, there are no firm agreements.

"If somebody knocked on your door and wanted to buy your house, you probably wouldn't turn around and sell it to the first buyer. You'd engage an expert to help you understand what it's worth and to properly market it," explained Kissack.

A paper mill with blue water to the left of it. There are trees branches covered in green leaves in the foreground.
In December 2021, the Powell River Catalyst Paper Mill was curtailed indefinitely, due to ongoing financial losses. (Submitted by Eldon Haggarty)

Kissack said Colliers was helping to filter extensive interest in the mill, and that if the company ultimately decides to sell, it would hope the new operator would respect the region's environmental values.

Kissack added he doesn't believe the company's working relationship with the city has been damaged, and that the parties can still work together.

Juergen Puetter, the CEO of Renewable Hydrogen Canada, said he's upset atPaper Excellence's move, after "well over a year" of discussions about acquiring a portion or all of the property details of which he said he could not provide due to non-disclosure agreements.

"We thought we had fundamental agreements established, and then things changed," explained Puetter.

H says his company's proposal to turn the site into a facility that sources electrical energy from wind, water and forest-derived carbon dioxide to make renewable hydrogen and methanolis "by far the best use of the site" for local jobsand directly in line with the province's goals outlined in its Clean B.C. 2030 plan.

Local owner could save workers, says union rep

Formosa said he agrees.

"The world is [moving] towardhydrogen fuel It's a very green, climate-friendly fuel that has a long life," he said.

Marvin Coe, the president of UNIFOR Local 76, which represents hundreds of mill workers at the site, said around 200 temporarily laid-off employees are still waiting to hear their fate.

Coe said he supports the move to sell to Renewable Hydrogen Canada, given itscommitment to retaining all laid-off employees and to hiring more of themand said that an overseas buyer might not fully understand the site's importance to the local economy.