Castlegar’s mayor says he’s pleased the local pulp mill will continue to operate as normal, despite the fact its parent company is filing for US bankruptcy protection as part of a restructuring process.
Brian Bogle said the news this week that Mercer International is filing for Chapter 11 protection in Texas did not come as a surprise, since it had been rumoured for weeks. But he took it as good news that Mercer Celgar will stay in business while that process unfolds.
“All the operations are continuing,” he said. “People are going to still be working full benefits. It doesn’t appear that it’s a bankruptcy proceeding to try and dissolve the operations of British Columbia, so I think that’s a positive.”
Bogle said the city has been in regular contact with the company, which has not made any further asks of them since earlier this year, when council granted an extension on the pulp mill’s property tax bill to the end of the year.
Although the mill has been struggling due to poor markets, Bogle said he has not heard any suggestion that the local business community is feeling a direct result.
“I was out with the Chamber of Commerce at business walks and the businesses we talked to didn’t indicate any issues related to Celgar,” Bogle said. “Certainly the economic conditions throughout the province may be having some impact, but for the most part, local businesses were saying positive things.”
Bogle said the local operation benefits both from being one of the more modern pulp mills in the province.
In a Facebook post this week, Mercer Celgar said it recognizes that the news about the company’s restructuring can raise questions for employees, their families, local businesses and the community.
“Our employees continue to work and receive their regular wages and benefits,” the statement said. “We continue to serve our customers, work with our suppliers and contractors, and meet our day-to-day business commitments.”
The restructuring is focused on reducing Mercer International’s corporate debt but does not contemplate a closure or liquidation of operations, Mercer Celgar said.
“We know that our operation is more than a workplace. It supports families, local businesses and the broader community. We recognize the importance of that responsibility and the trust that comes with it.
“While the financial restructuring process moves forward, our focus remains on what matters every day: the safety of our people, supporting our employees, serving our customers and maintaining the relationships we have built within our community.”
The Castlegar mill employs about 400 people. Although 21 people were laid off this summer during a temporary closure of the mill’s log yard and woodroom, following a major maintenance shutdown last month, those staff have returned to work.
