by Derek Cornet

Officials with Paper Excellence were on damage control May 26 after company vice-president David Kerr announced significant layoffs were possible at Meadow Lake Mechanical Pulp.

He made the statement at a Prince Albert Chamber of Commerce luncheon where he was the keynote speaker. While he was there to speak about re-opening the Prince Albert mill, he took the opportunity to urge those in attendance to contact their MLA because of SaskPower’s recent rate hike.

“This has a huge affect on Meadow Lake,” Kerr stated. “Meadow Lake’s margins are razor thin and, with 10 per cent on their power bill, it has a major impact on their bottom line… We’d have to lay off a significant amount of guys (employees) in order to make up that difference.”

When asked what people can do to help the situation, Kerr urged them to contact their MLA. He said 10 per cent is outrageous, it couldn’t be mitigated and they simply can’t afford it.

“At the current price of BCMTP (bleached chemi-thermo mechanical pulp), they won’t make money and, right now, they’re running because they make money,” he said.

On the same day of the announcement, a letter from general manager Simon Imray was sent to all pulp mill employees. It confirmed the cost of production would increase due to the SaskPower rate and acknowledged they’re discussing the matter with the company and provincial government. The letter, however, also stated Paper Excellence doesn’t have plans for layoffs.

Meadow Lake MLA Jeremy Harrison has seen the letter, stating it was tabled in the Legislature. He said he understands concerns expressed by ratepayers, but noted Saskatchewan has the third lowest utility package in the country.

“We work hard to keep rates as low as we possibly can, but we do need to make investments into infrastructure, improvement and expansion with a growing population,” Harrison said.

Also aware of the situation is Meadow Lake mayor Gary Vidal who said the pulp mill is a significant industry in the area. He would hate to see layoffs at the mill, which currently employs 180 people, noting it provides good paying jobs and has many spinoffs. Vidal went on to say other industries such as trucking, harvesting and support services are tied to the mill.

“It causes a lot of economic activity,” he remarked. “We would want to see it continue to succeed. My understanding is they’re doing pretty well and I hope that’s the case.”

The mill is one of the largest purchasers of electricity in the province, which it needs to power five, 14,000 horse power motors at the facility.

With files from The Prince Albert Daily Herald