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Atikokan pellet plant stays open as Rentech goes bankrupt

Purchase agreement was reached with True North Timber affiliate

ATIKOKAN, Ont. -- The future of an important player in Atikokan's economy appears secure despite the bankruptcy of U.S.- based Rentech Inc.

The company struck a deal in December to sell its Atikokan wood pellet mill, just before filing for bankruptcy.

If the transaction is completed, the new operator will be an affiliate of True North Timber, a forest resource company with operations in the Chapleau area.

Atikokan Mayor Dennis Brown said "it sounds like it's just a matter of time until the process is completed. They'll continue to operate and they're operating now to produce pellets for the Ontario Power Generation plant here in Atikokan."

Brown said there are seven years left on the contract with OPG.

"There's a market for this product and they certainly have space to produce a lot more. Maybe with a new company coming in, they'll have access to a new market and they'll be able to add more jobs here," he said.

The mill currently employs about two dozen people.

Rentech's other northern Ontario asset, a pellet plant in Wawa, was idled about a year ago. The company has applied for the appointment of a receiver to sell or liquidate it.

In a news release, it said the disposal is not expected to impact normal operations in Atikokan.

The Northern Ontario Heritage Fund Corporation gave Rentech a conditional grant of $1 million to open the Atikokan plant.

The province is seeking to recover $2.5 million in conditional funding it provided for the mill at Wawa.