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More than 20 companies have refused to buy the Abitibi-Consolidated paper mill in Stephenville, Nfld. since its closure eight months ago, the Newfoundland government announced Wednesday.

The lack of interest is symptomatic of the abysmal pulp and paper industry and the bleak future that lies ahead for single-industry towns, Newfoundland's natural resources minister said.

"Unfortunately, it doesn't seem to be very bright," Kathy Dunderdale said in an interview.

"We haven't done a really good job in Newfoundland and Labrador in the past of diversifying our economy."

Abitibi-Consolidated shut down the mill in December, laying off 300 workers and delivering a severe economic blow to the west coast town of 7,000. The province approached various companies in the lumber industry with hopes of resurrecting the plant, but none of them wanted to purchase the facility.

"(It) certainly makes you kind of relive the feelings that you had the day that the announcement to close the mill was made," Stephenville Mayor Tom O'Brien said in an interview.

"It doesn't come as a surprise to us. It's something that we would prefer not to be happening, but that's the reality we have to face."

The news also came as no surprise to some former workers, who were convinced the mill would never reopen when the company began issuing severance packages.

"Abitibi-Consolidated, they were quite clear right from the start," said former mill worker Kevin Pilgrim.

"They said that if the severance pay was paid out, that this mill would probably never open again . . . Some union people held out hope, but I wasn't one of them."

Over the past year, Abitibi-Consolidated also closed mills in Kenora, Ont., and Champneuf, Que., because of soaring energy costs, the rising Canadian dollar and a gradual drop in newsprint consumption throughout North America.

The province announced the creation of a committee to find ways of luring more investment to Stephenville after its largest employer shut down. Some of the ideas to generate more employment focus on the agriculture and aquaculture industries.

But it remains uncertain whether such spinoffs will be able to make up for the losses incurred since the plant's closure, Ms. Dunderdale said.

Some of the laid-off employees have either retired or moved to the mainland for other opportunities, Mr. O'Brien said.

Two weeks ago, Abitibi-Consolidated reported second-quarter earnings of $157-million, contrasting with a loss of $43-million in the same period a year earlier.

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