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Pulp Dreams

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Issue: 78 Section: Features Geography: Atlantic Nova Scotia, Pictou Topics: business, Indigenous, pollution

July 6, 2011

Pulp Dreams

Pictou Mill is Asia Pulp Paper's latest acquisition

by Miles Howe

If APP purchases the Northern Pulp-owned mill in Pictou, Nova Scotia, and all signs point to the deal being finalized quite shortly, it will be their fifth Canadian pulp mill acquisition in as many years. Photo: Calypso Orchid.

HALIFAX—If you thought that the Canadian pulp and paper industry was environmentally irresponsible, you were right. But the new players on the clear-cut block make them look like a bunch of patchouli-scented tree-huggers. This is the story of how Canada hopped into bed with one of Asia's worst environmental criminals, and how for the Pictou Landing Indian Band in Nova Scotia, it's just one more proverbial slap in the face.

Amidst a lack of fanfare from mainstream Canadian media, and encouragement by the federal government, a company known as Paper Excellence Canada Holdings Corporation has lately been buying up Canadian pulp mills at a rapid rate. Paper Excellence is a shell company of global pulp and paper giant Asia Pulp Paper (APP), itself the logging and pulping arm of the massive Indonesian conglomerate, known as Sinar Mas.

In 2001, APP defaulted on $12 billion in bonds, kicking the Indonesian economy, and indeed the entire Southeast Asian economy, into a downward spiral. Three independent audits have never been able to account for between three and four billion dollars, in part because APP simply re-financed itself through the financial arm of Sinar Mas. APP has illegally logged a national park in Cambodia, and makes a regular practice of creating shell companies, illegally logging, and by the time the underpaid forestry authorities figure out who's responsible...POOF! They're gone.

Richard Brooks, Forests Campaign Coordinator for Greenpeace, has spearheaded a global campaign to boycott APP products. Large-scale paper distributors, such as Xerox, Staples, and Target, have heeded Brooks' message, and now refuse to carry APP products. In an interview with The Dominion, Brooks says:

(APP) is on this mission to grow themselves into the largest paper company in the world...They're involved with illegal logging and deforestation in Indonesia, and quite a bit of their pulp and paper production is in Indonesia...These are old-growth, tropical, rainforests that are being cut down, and turned into acacia plantations and eucalyptus plantations, or are being turned into palm oil plantations, which is another division of their company.

Brooks continues:

You've got endangered species habitat that's being wiped out...orangutans, Sumatran tigers, rhinos...a lot of logging that happens outside of their legal concessions. There's evidence of them logging in protected areas...Huge amount of conflict with local communities which they are disenfranchising...basically going in, logging the hell out of the forest, putting in these (palm oil) plantations, and not asking for any approval from local communities.

If Paper Excellence/APP/Sinar Mas get their hands on the Northern Pulp-owned mill in Pictou, Nova Scotia, and all signs point to the deal being finalized shortly, it will be their fifth Canadian pulp mill acquisition in as many years. The other mills are located in Howe Sound, British Columbia, MacKenzie, British Columbia, Meadow Lake, Saskatchewan, and Prince Albert, Saskatchewan.

The Canadian pulp mills in question haven't seen this much attention in years. The mill in Pictou has been surviving on a steady diet of government loans for almost a generation. The Prince Albert mill was mothballed at the time of sale. But China is entering a phase of consumerism known as the "paper-culture," and suddenly pulp is again a very hot global commodity. APP simply can't keep up with the Chinese demand for toilet paper, so it has come calling for the mills, and, more importantly, Canada's forests.

We should note that Paper Excellence is not buying any Canadian paper-making facilities. Brooks interprets this to mean that we are in fact witnessing the death of the Canadian, if not North American, paper-making industry, as Canadian pulp will now travel back to Asia, get mixed up with Indonesian hardwood pulp, be made into paper, and then travel back to Canada.

Ed Roste, Vice President of Operations for Paper Excellence, and former VP at Meadow Lake, Paper Excellence's first Canadian pulp mill acquisition in 2006, claims, in an email interview, that while the majority of Canadian pulp will in fact be shipped to China to make paper, there is still a significant North American client base for Canadian pulp. Roste speaks of the “excitement” of the new market opportunities.

The Harper government has opened the public coffers to pay for upgrades to mills all across the country. Canadian taxpayers are on the hook for the 'Pulp and Paper Green Transformation Program' (PPGTP), in which Canadian mills can access up to $1 billion in grants. If Canadian pulp and paper mills were nationalized, such a program might make economic sense for Canadians. As it is taxpayers are to pay for "greening" the mills, only to have many of them sold off to foreign investors, like Sinar Mas, with problematic environmental and financial histories. Paper Excellence's Howe Sound mill received more than $45 million, and the Meadow Lake mill received $2.6 million.

Not to be outdone, in January of 2011, two months prior to the sale being made public, Peter MacKay, Canadian Minister of National Defense, whose family handily owns sizable woodlot holdings in the Pictou area, announced that the Pictou mill would be receiving $28 million under the federal grant. In a telephone interview, Don Breen, Vice-President of Strategic Planning and Government Affairs at Northern Pulp, noted that the $28 million would be used to “reduce odour at the mill by up to 70 per cent, improve boiler performance, and invest in renewable energy initiatives.”

In Nova Scotia, the Pictou mill isn't just a taxpayer-subsidized employer to 230 mill workers, it's the home of a very dirty secret.

Opened in 1966, it is infamous for its continued use of once-idyllic Boat Harbour, a natural lagoon that is located on Pictou Landing Indian Band reserve lands, as an effluent dumping grounds. As documented by the King's College Investigative Journalist Team in 2009, an estimated 1,000,000,000,000 litres of liquid pulp mill waste has poured into Boat Harbour since then, causing untold environmental destruction.

Indeed, an indemnity agreement was signed in 1995 between Scott Maritimes, original owners of the mill, and the provincial government. The agreement guarantees that the Nova Scotia government (actually, Nova Scotia taxpayers) will swallow the costs of cleaning up Boat Harbour. The agreement is valid in transfers of mill ownership. The current NDP provincial government has no alternative plan on what to do with the mill waste, and the Pictou Landing Band is currently in a two-year-and-counting legal battle with the province to see Boat Harbour closed.

Boat Harbour is now a foul-smelling, foam-encrusted, 142-acre wasteland, largely devoid of life. Don Breen, one of the witnesses to the 1995 indemnity, makes no mention of any of the $28 million going to clean up the Boat Harbour disaster that he personally has helped whoever owns the Pictou mill wash their hands of.

In an interview with The Dominion, Kevin Christmas, Indigenous Mi'gmaw, band advisor to Pictou Landing and long-time activist against the pollution of Boat Harbour, notes that effluent-capture technology has existed for years, and that the dire straits of the Pictou Landing Band could have been avoided from the start.

“Boat Harbour is at the tail end of a beautiful reserve called Canada.” says Christmas. “What happens there is one hundred and ten million gallons of the worst possible effluent is being dumped every day, for the last fifty years, in the middle of this beautiful reserve...It's destroying and killing the people. The children...[they] don't know what's wrong with them. But they are not going to live very long lives, and probably will never have children because of base-metal contamination. It's the end of the generation at Pictou Landing.”

Charlie Parker, Minister of the Nova Scotia Department of Natural Resources, whose riding is located in Pictou West, site of the mill, unveiled the province's 'Renewable Electricity Plan' (REP) in 2010. The REP considers biomass burning, which can involve large-scale, whole-tree harvesting, to be a renewable source of energy.

The repercussions of this definition of 'renewable' have already been felt in Northern Pulp-owned land. In the summer of 2009, Northern Pulp made national headlines in Canada by decimating a wide swath of land in the Musquodoboit-Sheet Harbour area through whole-tree harvesting. Katy Didkowsky, of the Save the Caribou Committee, and a local tourism operator, called the scene a “purposeful massacre.”

Musquodoboit-Sheet Harbour may only be the start. Frank Magazine (Issue 611) recently reported that over 28,000 parcels of land in Nova Scotia, almost 250,000 acres, are without an original Crown grant. The archaic, neo-colonial law in Nova Scotia states that without an original grant, which may be over 300 years old, the land belongs to, and can revert back to, the Crown. Nova Scotia has one of the lowest percentages of Crown land available. That the provincial government has found this new source of potentially exploitable land is perhaps more than convenient.

In this light, it is no great stretch of imagination to interpret the $28 million grant for odour reduction, improved boiler performance, and "green" energy capture as simply implying that emissions from the mill will smell better, while processing more trees, potentially whole trees, and burning more wood as biomass. Anonymous sources in Pictou confirm the mill's preparedness for increased production, and note that boilers “which have not been active for years” are now operational.

The Pictou Chamber of Commerce has come out in favour of the mill's sale. The Communications, Energy, and Paperworkers Union of Canada (CEP) has also endorsed the sale of the mill in Pictou, as it has done for the other four Paper Excellence acquisitions. Representatives from the CEP were unavailable for comment on whether they knew, or cared, who the actual new owners of the mill were.

The NDP government of Nova Scotia went so far as to engage in a public meet-and-greet with Paper Excellence's VP Ed Roste, and fully endorsed the sale. When Richard Brooks questioned whether the government knew of the links to APP and Sinar Mas, the province pleaded ignorance.

All groups were shamefully mum on addressing the decades-overdue clean-up of Boat Harbour.

For the rest of Nova Scotia, and Canada, it remains to be seen whether we will see the forest for the trees.

Miles Howe is a journalist in Halifax. This article was originally published by the Halifax Media Co-op.

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The Dominion is a monthly paper published by an incipient network of independent journalists in Canada. It aims to provide accurate, critical coverage that is accountable to its readers and the subjects it tackles. Taking its name from Canada's official status as both a colony and a colonial force, the Dominion examines politics, culture and daily life with a view to understanding the exercise of power.

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