23:21:57 EDT Fri 09 Jun 2023
Enter Symbol
or Name

West Fraser Timber Co Ltd
Symbol WFG
Shares Issued 103,123,472
Close 2022-04-05 C$ 96.10
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West Fraser to shut 1/2 production lines at Alta. mill

2022-04-05 18:27 ET - News Release

Mr. Ray Ferris reports


West Fraser Timber Co. Ltd. will permanently reduce capacity at its pulp mill in Hinton, Alta., by the end of this year. One of Hinton Pulp's two production lines will shut, and the remaining line will produce unbleached kraft pulp (UKP) rather than northern bleached softwood kraft pulp (NBSK).

"Hinton Pulp has been in operation since 1956 and these changes are necessary to simplify our operation, reduce capital requirements and greenhouse gas emissions, and better align with consumer expectations," said Ray Ferris, president and chief executive officer, West Fraser.

The capacity reduction will see staffing levels transition from 345 positions to 270. West Fraser expects to mitigate the impact on employees through natural attrition, retirements and by offering employment opportunities at other West Fraser operations.

"Our Hinton Pulp team has been engaged in a comprehensive review process and I want to thank them for their creativity and commitment to the mill, our customers and the environment. We remain strongly committed to the community of Hinton, the future of the plant, and to our neighbouring lumber operation, Hinton Wood Products," said Mr. Ferris.

The environmental benefits of moving to a single UKP production line include:

  • An estimated 35-per-cent reduction in greenhouse gas emissions (GHGs), which is equivalent to taking approximately 19,900 cars off the road per year;
  • An estimated 25-per-cent reduction in water use, air emissions and waste generation;
  • Elimination of chlorine dioxide emissions.

As the world moves away from single-use plastics, UKP is now used increasingly in a wide variety of everyday items including cardboard packaging, grocery bags, fibre-cement board and specialty products.

Since late 2021, the mill has undertaken several product trials and received positive initial customer feedback as to the quality and strength of the pulp produced. Currently, mill employees are preparing for the transition after satisfying all existing customer commitments for NBSK.

It is anticipated that an impairment charge of approximately $13-million (U.S.) will be recorded in West Fraser's first quarter 2022 results associated with the write-down of equipment that will be decommissioned permanently as part of the transition to UKP.

About West Fraser Timber Co. Ltd.

West Fraser is a diversified wood products company with more than 60 facilities in Canada, the United States, the United Kingdom and Europe. From responsibly sourced and sustainably managed forest resources, the company produces lumber, engineered wood products (OSB, LVL, MDF, plywood and particleboard), pulp, newsprint, wood chips, other residuals, and renewable energy. West Fraser's products are used in home construction, repair and remodelling, industrial applications, papers, tissue, and box materials.

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