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Mill impasse continues in Red Rock

At issue is a $5-million fund set aside by Norampac to help cover costs of cleanup of the site, which closed in 2006, putting 300 employees out of work.

THUNDER BAY – All that’s holding up remediation of Norampac’s former Red Rock mill is a $5 million payment the company set aside for environmental clean-up.

This hasn’t stopped the Northern Ontario community from considering legal action against the property’s current owner, Riversedge Developments, to speed up the process and seek $2.1 million in owed back taxes.

However, a representative for the company said without the money, Riversedge is stuck in a holding pattern.

Don Evans, a partner at Riversedge who has been trying to repurpose the industrial site for the past three years, said when the mill was first sold by Norampac in 2007 to a company called North American Logistic Services Inc., the seller doled out $10 million to encourage new production at the facility, according to a CBC report at the time.  

The money was to be split in half, $5 million to keep the site operational, $5 million for the clean-up.

Evans said that second $5 million has never been paid.

The purchaser sold off virtually everything of value at the mill, and then in 2014, the 600-acre mill, which employed 300 people until it was idled in 2006, was sold to Riversedge for $10 by the township, which took over the property on tax arrears.

“Riversedge bought the property with the idea of cleaning it up and then redeveloping it to different businesses,” Evans said.

“(The money) is something Norampac has got, that was not paid out ... To my knowledge that money has not been made available and that’s part of the reason, the main reason, why there’s been a delay in finishing the clean-up, in order to redevelop the property the way it should be.”

Norampac’s legal representative at the time has been contacted for comment about the status of the $5 million, but has yet to respond.

Red Rock Mayor Gary Nelson has a different take on the five-year impasse.

“We are frustrated, and where we’re at right now is pretty well a standstill,” Nelson said.

“Something’s got to be done down there and I think right now is the time, to maybe join in with some of these other communities and get something done.”

Nelson was referring to a standoff in Fort Frances, where Riversedge has bought Resolute’s former mill and is unlikely to reopen it as a paper producing facility, drawing the ire of the town’s officials.

Nelson said the expectation in 2014, when they sold the mill to Riversedge, was that another business was lined up for the site. Evans confirmed Riversedge president Justus Veldman thought he had a deal in place with a Northern Ontario company, but instead the company declared bankruptcy days later.

Nelson isn’t buying what he sees as excuses.

“He told us that place would be cleaned up like a park and bringing new business into town would be very easy. If you go down there and take a look at that lot, it looks like a war zone.”

Red Rock officials have sent letters to both the provincial and federal ministries of environment, said town CAO Albert Headrick, but to no avail.

“We have received a reply back from the federal environmental ministry and they have indicated a couple of inspections have been conducted by their personnel in regards to any (leaching) that’s going into Lake Superior,” Headrick said.

“They were not prepared at this time to share any additional information with us. We have submitted freedom of information requests to both ministries to find out about the outcomes of those inspections and what has been done since those environmental assessment were done, after the mill closed.”

In addition to mills in Fort Frances and Red Rock, Riversedge Developments also owns abandoned mills in Iroquois Falls and Sault Ste. Marie.

Leith Dunick

About the Author: Leith Dunick

A proud Nova Scotian who has called Thunder Bay home since 2002, Leith is Dougall Media's director of news, but still likes to tell your stories too. Wants his Expos back and to see Neil Young at least one more time. Twitter: @LeithDunick
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