The Nova Scotia government reached a settlement with the Paper Excellence Group, owner of Northern Pulp mill in Pictou County, which has been closed since 2020.

Under the settlement, the company would not resume operating the Pictou mill and instead look at building a new kraft mill in Queens County, in the same area of the former Bowater mill.

“We’ve come a long way and have come to a resolution that is fair to all sides — settling legal and financial issues, protecting pensioners and setting a new path forward,” writes Premier Tim Houston in a news release.

“The company believes there could be a future for them in Nova Scotia, working with the forestry sector in southwestern Nova Scotia, and we’re open to hearing them out.”

The Pictou County mill was closed in 2020.

Since June of 2020, the company was under creditor protection with the British Columbia Supreme Court.

Paper Excellence Group filed a lawsuit for $450 million against the province of Nova Scotia in December 2021.

The court ordered the province and the company to enter a mediated court process in April 2022.

Viability of new mill

If the company finds the Queen County site viable for a mill, a process that would take up to nine months, the government says the company will:

• pay about $50 million for costs incurred by the company through the court process
• pay the province $15 million to settle its debts, nd the province will release its security
• top up Northern Pulp pension plans by about $30 million
• seek financing and work with the province and other stakeholders to establish a new mill

If the company finds the Queen County site is not a viable place for a mill, they will decommission the Pictou County mill and also sell their timberlands, making payments with the proceeds in this order:

• about $50 million for costs incurred by the company through the court process
• $30 million to top up the pension plans
• $30 million to the province to settle its debts; the province will release its security
• $15 million toward the cleanup and maintenance of the Northern Pulp site and implement a site closure plan
• any remaining funds to the province

The province and the company will meet in court on May 31, where they will decide whether to accept the settlement terms.