NS Gov't Announces Mega-Deal With Resolute

The Nova Scotia government has announced it has acquired 220,000 hectares of woodlands, Brooklyn Power Corporation and the former Bowater Mersey mill site. Premier Darrell Dexter announced the mega deal through a media release on Monday night. The land and assets were acquired from Resolute Forest Products. The Montreal-based company closed the former paper mill near Liverpool in June, throwing about 320 people out of work. Under the terms of the arrangement to take over the assets, the province is acquiring the shares of Bowater Mersey for $1 from Resolute and the Washington Post. However, with those shares come worker pension and severance liabilities that the province says are estimated to be $118.4 million and have to be repaid as the pension is wound up. In addition, Paul Black, director of policy and community planning in the premier's office, said that the acquisition will add $117.7 million to the province's $13.3 billion debt.

Other details of Resolute/NS Gov't Deal - in purchasing the shares of the company, the province now controls:

--  555,000 acres of commercial and protected woodlands, including the Medway, Rossignol and St. Margaret's Bay districts. The land's fair market value is pegged at $117.7 million or $212 per acre. The province issued an expression of interest earlier today, and is exploring opportunities for a Mi'kmaw forest initiative with the Assembly of Nova Scotia Mi'kmaq Chiefs.

-- The former Bowater mill site in Brooklyn, including bio-refining machines, valued at $5 million. The site will be transformed into a research, demonstration and development centre of excellence and innovation in cleaner energy, bioenergy and forestry products and technology.

-- Brooklyn Power Corp, a 30-megawatt biomass generating facility.  The province will sell Brooklyn Power to Emera for $25 million in order to protect ratepayers from the termination of the current Power Purchase Agreement (PPA), which expires in 2025.

The value of the assets acquired by the province, including the woodlands, Brooklyn Power, the mill site and fibre inventory, cash and tax credits total $150.4 million.

Total liabilities are $136.4 million, including $118.4 million of the company's assets funding the pension liability and severance, and the extinguishing of a portion of the company's debt at $18 million.