HALIFAX – Nova Scotia’s government is adding $117.7 million in debt to acquire a large tract of private forest land that belonged to Resolute Forest Products Ltd.
The deal announced Monday night will give the province control of 220,000 hectares of woodlands in the province’s southwestern region, along with a power generation plant, the factory site and the wood fibre inventory of the defunct paper mill.
Resolute Forest Products Ltd. closed the former Bowater-Mersey paper mill near Liverpool, N.S., in June, throwing about 320 people out of work.
Under the terms of the arrangement to take over the assets, the province is acquiring the shares of Bowater Mersey for $1 from Resolute and the Washington Post Co. Ltd.
However, with those shares come worker pension and severance liabilities that the province says are estimated to be $118.4 million and which will have to be repaid as the pension is wound up.
In addition, Paul Black, director of policy and community planning in the premier’s office, said that the acquisition will add $117.7 million to the province’s $13.3 billion debt.
Note to readers: This is a corrected story. An earlier story said unfunded pension liabilities will be added to province’s debt.