SAINT JOHN, N.B. - Irving Pulp and Paper is planning to spend about $450 million to modernize a mill in Saint John, making the announcement a day after the New Brunswick government lifted a cap on the amount of softwood it will make available to the forestry industry from Crown land.
The company says work on its mill on the west side of the city is slated to begin this spring and will create the full-time equivalent of 600 jobs.
CEO Jim Irving thanked the province Thursday for making a supply of wood available.
"We appreciate the commitment of the province to ensure a sustainable wood supply that makes this modernization program possible," he said in a news release.
The province's new 10-year forestry plan will allow companies to harvest an additional 660,000 cubic metres of softwood a year â€” a hike of 20 per cent from existing levels.
Natural Resources Minister Paul Robichaud said Wednesday the increase will bring the total to about 3.9 million cubic metres of spruce and fir, enough to add 500 new jobs. The government estimates the plan will generate more than 1,200 construction jobs as mills around the province begin to modernize.
Irving Pulp and Paper says its spending on the project is the largest investment in a pulp mill in Canada since 1993.
There are two phases to the project, the first costing $198 million to upgrade the way wood chips are handled at the plant. It plans to complete the work in 24 months.
The second phase will cost $250 million to install a modern pulp dryer that will replace three existing machines at the mill. The company says it expects to begin engineering work on the second phase this fall and estimates it will take 2 1/2 years to complete the construction phase once it starts.
Irving says it is planning further announcements at its sawmills in Doaktown and Chipman on Friday, and at its mills in northern New Brunswick and Sussex at the end of March.
Premier David Alward said the spending by Irving shows the province's biggest industry has a future.
"This project will put boots in the woods and in our mills in every region of our province," he said in the company's news release.
As part of its forestry strategy, the government says it will keep a promise to increase the number of protected natural areas in the province, bringing the total area to 270,000 hectares.
Liberal Opposition Leader Brian Gallant has questioned whether the amount of money spent on planting and silviculture programs will adequately keep pace with the higher harvest levels in the plans.
Green party Leader David Coon said taking 20 per cent more wood from Crown land will decimate the province's forests.
On Wednesday, Robichaud said the strategy is aimed at giving the forestry industry a chance to rebound.
He said before 2000, there were 105 mills operating in New Brunswick and today there are fewer than 40 in operation.