Nfld. Premier Revokes Resource Lease, Ontario to Follow Suit?
Canada: About two weeks ago, AbitibiBowater Inc. announced plans to shut down their century-old Grand Falls, Newfoundland pulp and paper mill early next year. At that time there was widespread speculation that they would close the mill and simply operate several profitable hydro-electric facilities.
But Newfoundland Premier Danny Williams made a bold move, and introduced new legislation for the people of the province to retain the water, timber, and hydroelectric assets.
Williams' Progressive Conservative government wants to end a deal -- signed more than a century ago when Newfoundland was still under British rule -- that gave a U.K. company resource rights in exchange for setting up a mill in Grand Falls-Windsor.
The mill has since exchanged hands a few times, with the latest owner, AbitibiBowater, saying it will shut it down this spring. That will throw hundreds of people out of work.
The shutdown announcement prompted the province's Tory government to revoke the company's rights to the resources. The province also wants to put the mill's power plant under the control of a Crown corporation.
MPP Gilles Bisson (Timmins-James Bay) says Ontario must act in the public interest. “Abitibi was given access to the water and trees of our region in order to create a very profitable operation. Selling off the dams to a third party will completely change the bottom line of this operation. Dalton McGuinty needs to stand up for the public interest and stop this sale.”
MP Charlie Angus (Timmins-James Bay) says the proposed sale speaks to the financial crunch facing the recently-merged paper giant. However, he points out that a quick fire sale of assets will only make matters worse. “The Iroquois Falls mill is a low-cost, reliable producer of paper. Its success is due to the fact that the three dams are part of the very infrastructure of the mill. The sale of the dams might bring some quick cash to the company but it will undermine the future of this operation. The Province would be completely irresponsible to allow Abitibi to get away with burning its furniture just to heat the house.”
"If a company that came here to do a milling and logging business decides it's no longer going to do that business. Do you think the province should allow it to leave with the rights to it's water and the rights to the land?" said Premier Danny Williams on Wednesday to CTV.
AbitibiBowater has threatened legal action.