Longlac mill to restart, despite $24M debt to taxpayers

CBC News has learned a company that owes Ontario taxpayers $24 million will be allowed to re-start operations in the northwest without re-paying the debt.

Buchanan is working to re-open the Longlac mill less than a year after the Liberal government forgave the company a $24-million loan.

The Ministry of Natural Resources said the new Buchanan-owned entity that owns the Longlac mill isn't responsible for old debts.

But the NDP candidate for Thunder Bay-Superior North said thats not right, adding that the Liberal party has a bad habit of giving Buchanan money at workers' expense.

"I mean some forestry workers across the northwest have lost everything and families and communities have been decimated," Andrew Foulds said. "We don't want to go through this again."

Foulds said opening a mill is only good news if workers and taxpayers are protected. He said Buchanan owes taxpayers about 80 million dollars in unpaid stumpage and loans.

"When people are pocketing this kind of money, why aren't we protecting their pensions, their jobs, their communities?"

Mill could be open by summer

But the mayor of Greenstone said re-starting the mill would mean up to 300 jobs in his community.

To get those jobs back, Ron Beaulieu said he has to work with the players who are at the table.

"At this time, Mr. Buchanan owns the Longlac saw mill and owns the Nakina sawmill and those are the players we're dealing with," he said.

Beaulieu said the mill could open before summer.

Greenpeace forestry campaigner Richard Brooks said this latest mill start-up needs to be longer-lasting.

"Their company [Buchanan] owes the province tens of millions of dollars in unpaid fees and stumpage fees and those should be paid back as a condition of reopening the mill," he said.

"We need to have long-term sustainable jobs in Greenstone and Longlac. A company that comes in, runs a mill for a couple of years and closes down and leaves hundreds of people saddled with bills and debt is not the kind of company that I think Ontarians want to see. So I'm hoping that's going to change if Buchanan does open these mills [and] that they'll take a different approach than they have in the past."

Foulds added talk of the mill reopening with a provincial election on the horizon is suspicious.

Ministry prepared to work with new companies

Meanwhile, a spokesperson for the minister of Natural Resources said the new Buchanan-owned entity is not responsible for old debts.

"Long Lake Forest Products Inc., which previously owned sawmills in Longlac and Nakina, is bankrupt and no longer holds any licences or wood supply commitments from the province," the ministry stated in an email response to CBC.

"Two Buchanan group companies have been created and have attained the sawmill assets: Longlac Lumber Inc. and Nakina Lumber Inc. The ministry is prepared to work with the new companies which have emerged from bankruptcy in regards to mill licences. The two new companies have no stumpage debt with the province."

The ministry went on to say all debts held by "Long Lake Forest Products Inc. are being dealt with through the Bankruptcy and Insolvency Act legislation and the applicable court processes."

Calls to Buchanan's office in Thunder Bay were not returned.