CORNER BROOK, NL (News release) -- Kruger confirmed that a significant step has been taken toward advancing its proposed $700 million diversification project at Corner Brook Pulp and Paper Limited (CBPPL), following the issuance of a non-binding letter of intent by the Government of Newfoundland and Labrador. Through this letter, the government has indicated its intention to work toward extending the Mill's existing power purchase agreement with NL Hydro for an additional twelve months to provide stability while the project is further assessed. This step reflects the Province's willingness to work collaboratively with Kruger to support CBPPL's continued operations and long-term future.

Since acquiring the Corner Brook Mill more than four decades ago, Kruger has remained committed to ensuring its continued viability despite persistent challenges in publication paper markets. As the only remaining paper mill in Newfoundland and Labrador, the facility is widely recognized as a cornerstone of the province's integrated forest and sawmill industry, supporting rural communities, high-quality employment, and the broader forestry economy.

The diversification project outlines a comprehensive plan to transform the Corner Brook site into a modern, competitive, and sustainable manufacturing complex. As previously announced, the project would include modernization of existing operations, upgrades to site infrastructure, and investments to expand renewable energy capacity and modernize existing hydroelectric facilities, positioning the Mill among the most competitive of its kind in Canada. In addition to securing the future of the Mill, the project aims to strengthen its supporting operations while also sustaining high-quality employment and reinforcing economic vitality across the region.

Given the scale and complexity of the project, continued alignment among all levels of government, along with the forest industry and other key stakeholders, will be essential to supporting the Mill's future and unlocking its full benefits for Newfoundland and Labrador.

The Government of Newfoundland and Labrador has signed a letter of intent with Kruger Inc., the owner of Corner Brook Pulp and Paper Ltd., to continue discussions related to its diversification plan, specifically a long-term power purchase agreement between the company and Newfoundland and Labrador Hydro.

The Provincial Government plans to extend the current interim power purchase agreement between Newfoundland and Labrador Hydro and Corner Brook Pulp and Paper Ltd. for 12 months, beginning July 1, 2026, and ending June 30, 2027. The Provincial Government is also prepared to discuss a long-term agreement to provide additional certainty for Corner Brook Pulp and Paper Ltd.'s sustainability and potential growth.

The company will continue to develop wood supply agreements with provincial commercial sawmill operators and expand investments in silviculture to support sustainable harvesting. Corner Brook Pulp and Paper Ltd. will continue to operate its mill with one paper machine and maintain its current workforce while the letter of intent is in effect. The parties also agree to explore implementing the company's long-term diversification project.

The letter of intent is available here.

Quotes
"Forestry has long been a mainstay of our rural economy, workforce, culture and heritage. Corner Brook Pulp and Paper Ltd. is a major employer that provides hundreds of jobs for people in rural communities. We will continue to review the diversification plan to ensure it works not only for Corner Brook Pulp and Paper Ltd. and the province, but for the entire forest sector."
Honourable Pleaman Forsey
Minister of Forestry, Agriculture and Lands

"Ensuring a stable and reliable supply of energy is critical to the long-term success of our province's industries. Extending our interim agreement will provide the time and certainty needed to work toward a long-term solution that supports Corner Brook Pulp and Paper Ltd.'s operations and protects jobs. We look forward to continued collaboration with Kruger to advance a sustainable path forward for the company and for all of us."
Honourable Lloyd Parrott
Minister of Energy and Mines

"We remain committed to responsible fiscal management while making strategic decisions that strengthen our resource sectors and the communities that depend on them. This extension allows us to take a measured approach as we assess the implications of a long-term arrangement and ensure it delivers value for Newfoundland and Labrador."
Honourable Craig Pardy
Minister of Finance