NewPage Port Hawkesbury to close indefinitely

The NewPage Port Hawkesbury Ltd. mill will be shutting down both of its paper machines next month for an indefinite period, putting about 1,000 people out of work.  

Company spokeswoman Patricia Dietz said Monday that the current economic conditions, including the strong Canadian dollar, led to the downtime.

The newsprint machine will be shut down on Sept. 10, while the machine that produces glossy paper for magazines will be turned off on Sept. 16. The closure will affect 400 people who work in the woods and 600 people in the mill. Many others depend on the plant for indirect jobs.

All employees will be laid off, Dietz said Monday, and there is no date to restart the machines.

"We're working on a schedule to see how that will play out," she said.

Premier Darrell Dexter is set to meet NewPage managers Tuesday in Halifax. He said he is prepared to travel to NewPage's Miamisburg, Ohio, headquarters to see what the province could do to keep a valued employer in northern Nova Scotia.

Conservative Leader Jamie Baillie said Nova Scotia can't control the exchange rate of the Canadian dollar, but needs to find a way to deal with the rising cost of electricity. Liberal Michel Samson agreed.

But none of the three politicians had any specific ideas about how to keep NewPage going. The mill is in Samson's riding and he said there are no operating costs to cut when employees haven't had a raise in five years.

Port Hawkesbury Mayor Billy Joe MacLean wants the provincial and federal governments to develop a business plan, involving government assistance if necessary. 

High loonie cost company $4M in second quarter

Dietz said the unfavourable exchange rate between Canada and the United States have made the mill unprofitable for more than a year.

Earlier this month, the company said the rising loonie cost it $4 million in the second quarter of this year. It also said it expects energy costs at the mill to jump another 16 per cent next year.

High utility and shipping costs also led to the shutdown, Dietz said.

Steven MacDougall from the Communications, Energy and Paperworkers Union Local 972 was optimistic the mill will reopen. "We all know the paper business is having a hard time. NewPage has taken downtime on other mills and restarted. Right now we are expecting this mill will restart and carry on as normal."

NewPage announced the closing just 10 days before hearings into an application for a special lower power rate available only to companies that will close without it.

Dexter dismissed the idea that the announcement was a ploy to get the discounted rate.

Dietz said the closure resulted from "current market and economic conditions and we'll shut it down indefinitely … and we'll hope for the best," she said.

"The quality of our workforce here is top notch. Certainly the paper we produce, we've gotten many awards for the quality of our paper."

The pulp and paper mill has been the major employer in the Port Hawkesbury area since the 1960s. It was sold to NewPage in 2007.

NewPage is the largest glossy paper manufacturer in North America, with $3.6 billion in 2010 sales and plants in six states and Nova Scotia.