Tolko closure a blow to MB foresters and contractors

By Sheilla Jones

The closure of the Tolko paper mill in The Pas is a blow to the 332 employees who will lose their jobs and a town that will lose a major employer. It’s also a big blow to the contractors and private foresters supplying the company’s roundwood and wood chips.

“It’s huge,” said Ward Perchuk, owner of Spruce Products Ltd in Swan River, in a brief interview from the bush. “It’s having a huge impact here.”

Tolko has been buying more than half of the 600-thousand cubic metres of pulpwood, wood chips and hog fuel that it uses each year from independent companies like Spruce Products. Perchak’s has been one of the largest independent suppliers in Manitoba delivering fibre to Tolko.

Other companies have been contracted directly by Tolko to cut inside the Forest Management Licence #2 area held by Tolko.

Jack Leptick and brother Kirk run Leptick Sawmills, a business that’s been operating in Cranberry Portage, about 100 km north of The Pas, since 1948. Leptick said he’s a small contractor working for Tolko, delivering about 4-thousand cubic metres a year of pulpwood and hog fuel to the mill.

“Now where are we going to sell our roundwood? Tolko has been a big customer, especially for poplar, and we certainly appreciated it. Poplar is just a weed, but when the price of oil was so high, they were buying poplar for hog fuel. And since we had to take down poplars to get the spruce and pine for logs, it was good to have a market for it.”

Tolko officials gave the cost of fuel for operating the boilers in the mill as one of the contributing factors to shutting down the operation. In 2014, Tolko noted that it did not have access to the cheaper natural gas used by competitors and instead relied on a combination of oil and hog fuel.

Waugh’s Woods in The Pas is also a big contractor working for Tolko. In recent years, the company harvested more than 20-thousand cubic metres of pulpwood for the mill. Owner Duncan Waugh could not be reached for comment.

The closure of the mill in The Pas will have far-reaching effects in northwestern Manitoba.

Leptick said it will take a toll on people in Cranberry Portage, too. He noted that Anderson Logging, a mechanized logging and heavy construction company based in the community will also be hit hard.

“In the whole community, it’s a big impact. But at least we still have Frontier Collegiate, which is our biggest employer.”

Frontier Collegiate is a residential high school for Northern Manitoba, with a campus residence for 200 students.

Announcement a big surprise

According to local government officials, the August 22 announcement of the mill closure came out of the blue.

Leptick said the announcement came as a complete surprise to him, too.

“Just before, I had phoned to talk to one of the Tolko foresters about my upcoming contract and he said he’d look into it. He didn’t know about the closure. I don’t think most people working there had any idea. They were still interviewing for hiring people.”

Tolko company president and CEO Brad Thorlakson announced the company was shutting down the unbleached kraft paper division at The Pas in December.

“Unfortunately,” said Thorlakson, “despite years of continued effort to improve the cost structure and business results of the operations, the business is not financially sustainable.”

The company had already closed down its sawmill division in 2009.

Leptick said he’s looking at options to replace the work he’s losing from Tolko. He said he’s been selling about 700-800 cords of firewood a year, along with some lumber to Hudson Bay Mining and Smelting in Flin Flon.

“We still sell lumber, but it’s not what it used to be. I’m thinking now of raw logs for building log cabins. We do have some large timber. People could order 30-foot or 40-foot logs in the fall and we can go out and cut them in the winter. I mean, we’ve got to do something.”