Premier Scott Moe announces increased timber allocation for new mill in Prince Albert

Premier Scott Moe announced Thursday that his government is increasing timber allocations to Saskatchewan-based company One Sky Forest Products, setting the stage for the company to open an oriented strand board (OSB) mill in Prince Albert.

The government has allocated nearly 1.2 million cubic metres of timber per year, an increase from the initial 845,000 cubic metres, to One Sky Forest Products.

"It's a very much a foundational step," Moe said.

Moe said the province plans to double the size of Saskatchewan's forestry sector by 2030, while supporting Indigenous participation in the economy.

One Sky plans to begin construction on the $500-million plant in 2025 and open it in 2027, creating an estimated 800 direct and indirect jobs.

"Many of these jobs will go to Indigenous and non-Indigenous people, and that's how we ensure all people benefit from the success," Moe said.

"We've waited a long time for this in this part of the province."

Prince Albert Mayor Greg Dionne said the city is 46 per cent Indigenous, on a path to 50 per cent, and welcomed this announcement.

"When I talk about forestry, I talk about careers, not jobs, careers. These are careers, because you get a job at the OSB plant, you'll be able to buy a house, buy a car, survive with your family," Dionne said, calling it a new day for the city.

"I encourage all the young people to make contacts."

Dionne said the mill will be within the city limits and will therefore pay Prince Albert taxes.

Pulp mill not happening

This newly allocated portion was initially assigned to an Indonesian company, Paper Excellence, for a pulp mill, but that project is no longer happening.

Moe said the pulp market is going down and the forestry industry is aligning to global needs.

One Sky founder and chairman of the board Brian Fehr agreed.

"Paper Excellence is done in Canada," he said noting the company is "furious" about a CBC investigation.

"I don't believe for a minute that pulp mill [will] reopen."

In a statement, a spokesperson for Paper Excellence confirmed that the company will not proceed with the Prince Albert pulp mill due to market and economic conditions.

"This was a difficult decision that was made with a lot of thought and care," the statement said.

"Market demand for unbleached kraft pulp (UKP), which is the kind of pulp PA Pulp would produce, is weak.
It is also extremely competitive with lower cost producers from other regions of the world."

Going forward, the company said it is still committed to continuing to operate in Saskatchewan with its Meadow Lake Mill.

Costs of mill doubled since 2021

Fehr said OSB has become one of the most in-demand building materials.

He said the plant will employ 400 people during construction, which is slated to begin by next year.

Plans for an OSB mill were announced years ago. The company was planning to move an old mill to Prince Albert and start production in 2022, but that didn't happen.

The expected price of the plant has risen to $500 million from $250 million projected in 2021.

"It's because it's a new version versus a used one. Obviously when you get into a new shiny car versus and old one, we're very excited that it's $500 million," he said.

Fehr said getting access to more timber means the project can now go ahead. He said global the demand for fibre is high.

The forest cover in the province spans 34 million hectares, almost the size of Germany.

Indigenous Forestry Investments, a coalition involving 12 First Nations, will partner with One Sky on this project.

Gary Daniels, CEO of Montreal Lake Business Ventures, said he is excited that the announcement means they will be part owners of the mill.

"Ownership means that we'll benefit from the wealth generated, create meaningful employment, and involve our business in the supply chain," Daniels said.