Northern Pulp is claiming that the changes it’s proposing for its 54-year-old pulp mill in Pictou County will make it “best in class.”
Even the blurb that appears on the Nova Scotia Environment and Climate Change page for the “mill transformation and effluent treatment facility project” includes the phrase “best in class.” And although Northern Pulp doesn’t ever get around to saying which “class” it is going to be best in, the phrase pops up another 10 times in the 126-page “registration document” that the company submitted on December 7 to begin the Class II environmental assessment process.
On page 19 of the registration document, the phrase even appears twice in the same sentence:
NPNS [Northern Pulp Nova Scotia] also recognizes that to succeed, a best-in-class mill must be operated by an organization with a best-in-class culture, and that building relationships based on trust and transparency takes time and significant effort. [emphasis added]
We’ll have a look at the claims about the mill and how “best in class” it is later.
First, a look at the “organization with best-in-class culture” that claims to be building relationships based on “trust and transparency.”
A mind-boggling “nebula of companies”
We can start with the fact that Northern Pulp Nova Scotia is not an “organization.”
It is a “Paper Excellence company,” a tiny cog in Sinar Mas, the gargantuan corporate machine of the multi-billionaire Widjaja family of Indonesia, which includes Asia Pulp & Paper (APP). Dozens of international civil society groups have dubbed APP a “notorious conglomerate,” while others point to its dismal environmental and human rights record.
According to Greenpeace, “Sinar Mas Group’s combined [greenhouse gas emissions] from its companies Golden Agri Resources (GAR) and Asia Pulp and Paper (APP) are equivalent to nearly 3.5 times Singapore’s annual emissions.” So, hardly a champion in the global fight to tackle the climate crisis.
APP’s countless subsidiaries and affiliates are also part of an obscure labyrinth of companies in corporate tax havens around the world, including the British Virgin Islands (ranked the #1 tax haven by the Tax Justice Network), The Netherlands (ranked #4), and Singapore (ranked #9).
In 2001, Asia Pulp & Paper set the record for the largest corporate default — nearly USD 14 billion — in emerging markets, a “dubious record” it still holds today.
On its website, Environmental Paper Network, a worldwide network of more than 150 civil society organizations, says this about APP:
APP is in reality a nebula of companies, linked by a complicated and un-transparent corporate structure. Some of these companies are included in the Sinar Mas conglomerate, while some of them are formally independent, but still controlled by the Widjaya [another spelling for Widjaja] family, and operating within a single commercial strategy. Actually, Asia Pulp & Paper as a company does not even exist. Some of the corporate associations with these companies are purposely kept hidden, possibly for commercial or fiscal reasons, but also to deny links with deforestation or to keep using the FSC [Forest Stewardship Council] certification after having been banned by that standard. This un-transparent structure has been also used to avoid the payment of its 13.9 billion USD of debt when it defaulted in 2001.
Although Northern Pulp and Paper Excellence Canada don’t let on that they are very much part of the Widjaja family’s global corporate empire, and would have us believe that they are genuinely Canadian and Canadian-run companies, Statistics Canada’s “Inter-corporate Ownership” website suggests otherwise.
A search for “Sinar Mas Group” on that website reveals that it “contains 50 corporations” in Canada, including 10 closely related to Northern Pulp Nova Scotia, and that no matter where they are resident, 49 of them are controlled from Indonesia.
The only exception among all 50 corporations is Canso Chemicals, located next to the pulp mill on Abercrombie Point, which once upon a time produced chlorine for the mill.
The Inter-corporate Ownership website says Canso Chemicals is owned 50% by Northern Pulp Nova Scotia Corporation, and controlled out of the United States. This is because, as the Halifax Examiner reported here, the other half of Canso Chemicals is owned by the giant American chemical, arms and ammunition manufacturer, the Olin Corporation. [1]
The mind-boggling puzzle of the Northern Pulp corporate family tree is far too complex to even attempt to unravel here, if such a thing were even possible. But what is obvious from the Inter-corporate Ownership website is that the companies that own the Pictou pulp mill and 420,000 acres of Nova Scotia (thanks to a $75-million government loan they have not repaid), are all clearly closely connected to Sinar Mas / APP, and controlled from abroad.
These are the same Northern Pulp companies and affiliates that are the “petitioners,” which in June 2020 sought and received creditor protection in the British Columbia Supreme Court, following the submission of an affidavit from Bruce Chapman.
In his affidavit, Chapman identified himself as the “general manager (Northern Pulp) of Paper Excellence Canada Holdings Corporation” and “General Manager of the Petitioners” with the exception of the company called “105 BC.”
Chapman described Paper Excellence Canada (PEC) as “a corporation incorporated pursuant to the laws of British Columbia and owns a 30% interest in the Petitioners; the remaining 70% ownership interest in the Petitioners is held by Hervey Investment BV (Netherlands) (‘Hervey’), a company under common control with PEC.”
Chapman then listed the seven petitioners (he called them “persons”) seeking creditor protection:
1057863 B.C. Ltd. (“105 BC”), Northern Resources Nova Scotia Corporation (“Northern Resources”), Northern Pulp Nova Scotia Corporation (“Northern Pulp”) and Northern Timber Nova Scotia Corporation (“Northern Timber”), 3253527 Nova Scotia Limited (“NPNS GP”), Northern Pulp NS GP ULC (“NPNS GP ULC”) and 3243722 Nova Scotia Limited (“NTNS GP”) (collectively referred to as, the “Petitioners”)
As the Halifax Examiner reported in its 2020 “Corporate Shell Game” series on the Northern Pulp’s creditor protection case, Chapman also explained that:
Two more affiliates, Northern Pulp Nova Scotia LP and Northern Timber Nova Scotia LP are not petitioners, but are “the main operating entities of the petitioners” and are “indirect subsidiaries of 1057863 B.C. Ltd and Northern Resources Nova Scotia Corporation.”
Chapman claimed these entities were “insolvent” and “seeking relief” from creditors in the BC Court.
That claim is, well, curious.
The petitioners’ largest creditor is their owner Paper Excellence, and their owner is part of a multi-billionaire-dollar corporate empire.
The family of petitioners is also, it so happens, suing the Nova Scotia government for hundreds of millions of dollars in profits it says it lost because of the 2020 closure of Boat Harbour for its pulp effluent. Northern Pulp claims it should have been able to keep using Boat Harbour for its effluent until 2030, as that is the time frame it was given in 2002 by the former Progressive Conservative government of Premier John Hamm, who later became board chair of the Northern Pulp family of companies.
This is not the first time Northern Pulp has taken Nova Scotia to court when it didn’t get what it wanted. In 2015 when it disliked a new Industrial Approval, Northern Pulp did the same, and didn’t withdraw the litigation until the Liberal government caved, and the company got what it want.
But it seems we are not supposed to pay any heed to all these pesky details, because according to that registration document the Paper Excellence company Northern Pulp submitted to Nova Scotia Environment and Climate Change, Northern Pulp has a “best-in-class culture,” and it intends to build relationships based on “trust and transparency.”
That the company isn’t paying back the nearly $85 million that it still owes to Nova Scotia while it is under creditor protection in a BC Court, and that it is now (the documents were filed yesterday) suing the bejesus out of the province, are just inconvenient facts that perhaps we are meant not to notice or to forget.
Is Northern Pulp serious?
There are some who are not convinced the company is even serious about revamping and re-opening the mill on Abercrombie Point.
Two people who don’t appear to have a lot of faith in Northern Pulp’s intentions are lawyers Robert Grant and Maurice Chiasson, who are representing the province in the BC Supreme Court.
In October 2021, they wrote to the Court in response to Northern Pulp’s request to use $450,000 of its interim financing (remember, that the Nova Scotia government gave Northern Pulp a break on repaying the nearly $85 million it owes Nova Scotians) so that it could basically go ahead and sue the province.
Grant and Chiasson wrote that the Nova Scotia government objected to the use of interim financing because:
The Province is concerned that the Applicants are using the CCAA [Companies’ Creditors Arrangement Act] process to fund their litigation against the Province under the guise of a restructuring, all while enjoying the significant protections afforded by the CCAA.
Not mincing their legal words, Grant and Chiasson added:
… the use of interim financing in this manner is prejudicial to the Province’s interests and it remains unclear how any purported litigation by the Applicants is in the best interests of the stakeholders as a whole. Rather, such litigation serves only to further the interests of the Applicants and their various related companies, under the guise of vague economic benefits that may be achieved.
Mill transformation claims “wildly optimistic”
Another who wonders if the project for a revamped mill isn’t some kind of elaborate ruse is Jill Graham-Scanlan, a property lawyer in Pictou and president of the community group, Friends of the Northumberland Strait.
Graham-Scanlan tells the Examiner that the claims Northern Pulp makes in the registration document about the transformation of the mill being “best in class” are “wildly optimistic and certainly not supported by either the studies they have performed in the past and submitted with their prior environmental assessment applications.”
“Nor are they supported by what we know about Pictou Harbour,” Graham-Scanlan says, referring to the company’s plans to dispose of up to 55 million litres a day of treated pulp effluent into the picturesque harbour between the town of Pictou and Abercrombie Point where the mill sits.
“Nor are their claims supported by our history with that company,” she adds.
Graham-Scanlan is of “two minds” about Northern Pulp’s actual intentions.
“Part of me does believe this is a game and they are just going through the motions of applying for an environmental assessment in order to further their legal claims,” she says. “But the other part of me is concerned because in the past they have been given approval by the province to operate based on a plan that seemed to be utterly unacceptable.”
One egregious example of that, says Graham-Scanlan, was that the province allowed the mill to operate for years with its pollution control equipment not functioning, turning a blind eye to the offence. She is referring to a 2009 consultant’s report that showed the scrubber on the mill’s power boiler, key to reducing emissions of carcinogenic particulate matter, had been out of commission since 2006. The Department of Environment ignored the report until 2012, when it finally issued a directive to the mill to fix the problem, imposing no fine and giving Northern Pulp until 2013 to do so, all the while handing out loans and grants.[2]
Pictou mayor Jim Ryan, who has dealt with Northern Pulp before and not backed down, is equally unconvinced that the company can be trusted, and unimpressed by Northern Pulp’s “best-in-class” plan.
“Based on my initial read of the latest Registration Document and Northern Pulp’s inability or refusal to respond to conditions set out for the previous EA [Environmental Assessment] Report, I have little faith that they are able to take necessary steps to meet prescribed environmental standards,” he says in an email to the Examiner.
Ryan continues:
Northern Pulp has, once again, failed to recognize its actions or accept any responsibility for the challenges faced by our community for the last 50+ years. Our concerns were ignored and dismissed in the first EA process and it appears as though things have not changed. As an example, in the Executive Summary under Description of the Existing Environment (second bullet), the writers of the document appear to be claiming that there has been “very little change” in air quality since the mill went into hibernation. Residents and businesses in the Town would disagree strongly.
Although the Town’s watershed appears to have avoided the potential for contamination by mill effluent, the risks have subsequently been transferred to our beautiful harbour and the valuable marine life that has been making a comeback since February of 2020. For many reasons, the release of toxic effluent into Pictou Harbour or its tributaries, at any concentration, is unacceptable.
“Another round with this trauma monster”
Comments on the Facebook page of Pictou Landing First Nation Chief Andrea Paul suggest that the mill’s plans are not very welcome there either. Above a December 8 post with a CBC story about the new Northern Pulp environmental assessment beginning, Chief Paul wrote “Another round with this trauma monster.”
No community suffered more because of the Northern Pulp mill and its effluent than Pictou Landing First Nation. For the first time in more than half a century, PLFN no longer has to live with the stench of Boat Harbour — or A’se’k (its original and actual name now that it is being restored as a tidal estuary) — in its backyard, discoloured water released from Boat Harbour lapping the shores of the Northumberland Strait in its front yard, and the stinking clouds of the mill’s emissions all around them.[3]
In a Facebook message Chief Paul tells the Examiner:
This mill cannot re-open. We finally have access to waters we could not enjoy. We are able to sleep with no fears of toxic air. We are able to smell the salt water, the trees and plants. The air is cleaner. The skies are brighter. This will not be taken from us. The Mill can plan their re-start somewhere else.
More lofty claims
Another one of the lofty claims Northern Pulp makes in its registration document is that the mill’s transformation will support the company’s “commitment to healthy forests and ecological forestry in Nova Scotia.”
Northern Pulp maintains that, “Harvested trees not suitable for lumber (tree-tops, center rot, broken trees or crooked portions), which were previously processed at NPNS, are currently being left on the ground, increasing the risk of future forest fires.”
A forestry professional who asks not to be identified says this claim is spurious, that the kind of intense cutting that has come with industrial forestry, which the pulp mill’s first owner Scott Paper introduced to the province, is itself what increases the forest fire risk in Nova Scotia. He explains:
We’ve got a lot more balsam fir in the landscape because of clearcutting. And it’s young, even-aged, lots of crowns at the same height. When you look at uneven-aged forestry, the crowns are all at different heights. Whether the contractors want to admit it or not, our wood’s getting smaller, and average diameter is getting smaller. It’s [Northern Pulp’s] just trying to get Nova Scotians thinking this is good thing because if we have a pulp mill not only does it create jobs but it reduces fire risks. That’s just stupidity. It’s a stupid debate. I would be embarrassed to put that in if it was me.
He says that Northern Pulp never took tree-tops and branches with needles, so their claims in the registration document are “not genuine.”
And he believes the only reason that Northern Pulp even wants to be active in Nova Scotia is for the fibre, not the pulp mill owned by a company that the “public doesn’t like.”
Why the Pictou mill when Paper Excellence has so many others?
This raises the question of what the real interests of Paper Excellence are in Nova Scotia, and why Northern Pulp claims to be set on re-opening the old pulp mill.
It’s not as if Paper Excellence has any shortage of pulp mills — or funds to purchase more of them — in Canada and around the world.
Paper Excellence owns two controversial mills in France that, like the Northern Pulp mill was in its day, are also notorious for polluting and flouting environmental rules, while soaking up public funds.
In February this year Paper Excellence won a case to acquire Eldorado Brasil Celulose, one of the largest pulp producers in the world, in a multi-billion-dollar deal that also gave it control of 230,000 hectares of eucalyptus plantations in Brazil.
This past month, the “Paper Excellence Group” finalized its US$4 billion acquisition of North American pulp and paper giant Domtar, a very big deal that caused a great deal of consternation among civil society groups and also pulp insiders in Canada who contacted the Examiner.
The deal gave Paper Excellence control of an additional 11 pulp mills in North America, including three in Canada, and nine manufacturing facilities in the US.
The acquisition was delayed several months until November 19, when the Competition Bureau of Canada announced it had “entered into a Consent agreement with Karta Halten B.V. (Paper Excellence),” which required that it sell one of the Domtar mills in Kamloops, BC to “an independent purchaser,” “to maintain competition in the southern interior and coastal region of British Columbia for the purchase of wood fibre.”
In other words, the Domtar takeover gave Paper Excellence so many mills in British Columbia, all desperately in need of fibre, that if it were allowed to keep Domtar’s Kamloops mill as well, it would have far too much “market power.”
It certainly looks as if Paper Excellence is after fibre as much — or even more — than it is pulp mills.
In April 2019, Paper Excellence permanently closed its mill in MacKenzie, one of the eight pulp mills it owned in British Columbia at the time, blaming a shortage of “local economic fibre,” and issuing a veiled threat to the BC government that it expected forest policies that would give it more access to “forest tenures.”
More recently, in November 2021, Paper Excellence indefinitely closed its tiskwat mill in Powell River, BC, one of three the company took over in 2019 when it acquired Catalyst Paper.
Paper Excellence vice-president Graham Kissack explained that the mill in Powell River just couldn’t “clear the bar” financially, saying that paper prices were weak in a shrinking market.
So the company closed two functioning pulp and paper mills in BC, but wants to re-open an old one that is in hibernation in Nova Scotia.
All of which begs the question of why, exactly, Paper Excellence would even be considering “transforming” and re-opening the Pictou County.
And yet, in its project registration document, Northern Pulp writes:
The demand [for paper products] is increasing due to the recent commitment to move away from single-use plastics and replace them with biodegradable wood and pulp containing alternatives with less environmental impact. The recent pandemic has highlighted the increased need for paper-based hygiene products and medical personal protective clothing and masks. Kraft pulp is an important commodity in supplying these needs.
And:
NPNS has a strong desire to resume operation in Nova Scotia and play an integral role in the economic recovery of Nova Scotia. NPNS will invest more than $350 million in the Mill Transformation Project, subject to further engineering work and a final investment decision.
Note that Northern Pulp doesn’t specify where it plans to get the $350 million it is prepared to “invest” in the project, whether that would depend on how successful it is in recuperating the more than $400 million in profits it says it has lost because of the closure of Boat Harbour.
Nor does it explain how Northern Pulp can possibly play an “integral role in the economic recovery” of a province it is suing from here to kingdom come.
One thing is eminently clear: the Northern Pulp / Paper Excellence saga is far from over.
On December 21, Nova Scotia Environment and Climate Change will release a “draft terms of reference for the preparation of an environmental assessment report” on which the public will have 30 days, or until January 20, 2022, to comment. Once the terms have been finalized, Northern Pulp will have two years to submit its environmental assessment report.
That gives the Paper Excellence company lots of time to drag the province to court in a drawn-out lawsuit to see how much it can get out of Nova Scotians, which hardly lends much credence to the claims the company is making that it wants to “play an integral part” in Nova Scotia’s “economic recovery.”
Endnotes
[1] The Canso Chemicals plant was decommissioned and dismantled in the 1990s, and a 2000 decommissioning report showed its legacy to be a “mass” of elemental mercury measuring “18 m wide and 10 m deep”in the bedrock under the former factory, and a secure landfill full of mercury-contaminated materials. (The Halifax Examiner has reported on Canso Chemicals and its mercurial legacy here, here and most recently, here).
[2] Details of this pollution control failure are contained in my 2017 book, The Mill – Fifty Years of Pulp and Protest.
[3] In his October 2021 affidavit to the BC Court, Bruce Chapman wrote that Northern Pulp had shared the “Mill Vision and Project Description” with PLFN, and attached a report from the Environmental Liaison Committee set up by Northern Pulp that stated the Committee had been “unable to convince” PLFN to meet. Chapman also referenced the 2012 legal action that Pictou Landing First Nation had re-activated in 2019 against Northern Pulp and previous owners of the mill for damages incurred over the decades. Chapman revealed that Northern Pulp had written to the government of Nova Scotia in August asking it to indemnify the company against the PLFN litigation. Three months later, the company would announce it was “taking steps” to sue the same government it had earlier asked to indemnify it from – cover any costs of – the PLFN litigation.
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And of course- reopening would be at the expense of the public purse.
Giving it to the thieves for revamping the mill. Hey everybody, is not that so much better an idea than having the thieves squeeze it out of in court?
I think the thickness of that bullshit layer they are spreading is a game they cannot lose at for trying. Spread it really thick so all their desperate minions continue to clamor for the mill revival.
If they get really lucky- dupe enough people AGAIN- they might even get away with re-opening the monstrosity !
And if that does not work- they win anyway for trying: because the attempt will “prove” to the judge in Nova Scotia that Northern Pulp has always been totally committed to this fine business (with all its profits that were still to come) that the government of Nova Scotia has so willfully destroyed….. for which the owners deserve now to be richly compensated.
Natural justice, you know.
Thx for filling in so many details, Joan Baxter, for doing the ‘journalistic accounting’ this issue deserves. & Thx Hfx Examiner/Joan Baxter for making this one publicly available, that is beyond the call…