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The Globe and Mail

Bid for shuttered N.S. paper mill sparks environmental outcry

The NewPage paper mill in Port Hawkesbury, N.S.

Andrew Vaughan/The Canadian Press

A controversial Indonesian pulp and paper company's expansion in Canada is bringing in new capital and jobs to rural communities, but critics are hammering the firm over its alleged destruction of rainforests in Asia.

Paper Excellence is the final round of bidding for a paper mill in Port Hawkesbury, Nova Scotia. A successful bidder for the bankrupt mill will be announced Nov. 21. If successful, it would be the company's second mill in Nova Scotia and sixth in Canada. The others are in Saskatchewan and British Columbia.

The company first invested in Canada in 2007 and has committed at least $300-million, underpinning more than a thousand jobs in the embattled forestry sector. It's based in the Netherlands and its Canadian headquarters are in Richmond, just south of Vancouver. The firm is controlled by the family of Eka Tjipta Widjaja, Indonesia's richest man and founder of conglomerate Sinar Mas.

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A major arm of Sinar Mas is Asia Pulp and Paper, which has been blasted by environmental groups such as Greenpeace for deforestation and ruining tiger habitat. Campaigns against Asia Pulp and Paper have convinced companies such as toymakers Hasbro and Mattel to stop buying its products for uses such as packaging. APP Canada acknowledges that it is affiliated with Paper Excellence but insists the operations are independent.

"They are looking to green their image because their practices in Indonesia obviously carry a horrendous track record," said Nicole Rycroft, executive director of Canopy Planet, a conservation organization.

She conceded that APP Canada and Paper Excellence abide by Canadian laws but is concerned the companies are using the country to rehabilitate the image of APP and Sinar Mas.

"We want to make sure that they don't use the Canadian market as a greenwash," Ms. Rycroft said. "They're looking for market legitimacy in North America. With their presence comes a responsibility. It can't just be a small part of your operations that are by the books."

Workers back Paper Excellence. After a Nova Scotia woman wrote to a local newspaper in April about Paper Excellence's first mill purchase there, the Communications, Energy and Paperworkers Union of Canada said it welcomed the investment on behalf of 630 mill workers and loggers. "These are stable jobs that are important to our community and rural Nova Scotia," said Local 440 president Mark MacLaughlin, along with mill executive Don Breen, in a letter to the local paper.

Greenpeace and APP continue to fire at each other in an ongoing battle. Greenpeace last week highlighted companies such as Hasbro that have cut ties with APP. The environmental organization said a "ground tour" in Indonesia in October "found extensive clearance of rainforests inside APP concessions in Sumatra, including areas mapped as habitat for the endangered Sumatran tiger."

APP, also last week, dismissed claims Greenpeace had previously made about the content of its paper products. APP said there was "no scientific basis" to an analysis that Greenpeace commissioned that showed APP paper contained "Indonesian rainforest fibre."

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The claims and counterclaims continued after the press releases.

"It's unfortunate that the only front they operate on is PR," said Greenpeace forests campaigner Richard Brooks.

Ian Lifshitz, a spokesman for APP Canada, said the company has retained some customers Greenpeace says have left the firm behind – but Mr. Lifshitz would not name names.

"We win and lose customers on a daily basis," said Mr. Lifshitz. "Some customers we do lose to the sustainability issue. Some customers we don't."

He said all of APP's operations, from Indonesia and China to Canada, are clean.

"All of our products are sustainable and certified," Mr. Lifshitz said.

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