Nova Scotia's lone qualifying paper mill to seek federal funds

A pulp and paper mill in Pictou County says it's the only mill in Nova Scotia that qualifies for money through a new $1-billion federal bailout fund for the struggling forestry sector.

Bob Bagdon, a vice-president with Northern Pulp Nova Scotia Corp. in Abercrombie, told CBC News the company will apply for funding.

The federal government announced Wednesday that the money is only available for mills that produce "black liquor," a waste byproduct created through the chemical pulp process that allows mills to generate steam energy.

Only mills producing black liquor between Jan. 1 and Dec. 31 of this year are eligible. They can receive 16 cents per litre of the substance, and must invest the money over three years to improve their energy efficiency.

Federal officials say 27 mills across Canada are eligible.

About 230 people are employed at Northern Pulp, known as Neenah Paper until last year. Another 400 people work in the woods. The provincial government recently gave the company a $15-million loan to allow it to continue operating.

There are two other large pulp and paper mills in Nova Scotia: AbitibiBowater in Brooklyn and NewPage in Point Tupper.