Dear editor,
The Crown Forest Sustainability Act requires independent third party audits to ensure the licensee’s compliance with the terms and conditions of the license, and remedies for any non-compliance. This is material and relative to the Ministry’s support of Resolute between 2014 and the final sale of the Fort Frances mill in July of 2019. The MNRF actions throughout this period are:
May 2014; Resolute announced permanent closure of the Fort Frances mill.
June 2017; MNRF waives repayment of the 22.5 million dollar loan for the Biomass Boiler. Resolute disclosed this waiver in its security and exchange filings for that year, the MNRF did not disclose this waiver until confronted in 2019.
December 2017; The MNRF requested a 10 year extension of the Cross Route Forest License from the Lieutenant Governor in Council based on the independent third party audits of Resolute’s compliance with the terms and conditions of the License from 2002 to 2012; the request was granted. The MNRF, at that time, knew the Fort Frances mill had been permanently closed by Resolute four years prior. Why did the MNRF wish to extend this SFL as written? See September 2020 below.
July 2019; Resolute sold the Fort Frances mill to the community development company subject to the Restrictive Covenant Agreement. This agreement clearly identifies the conditions by which Resolute would sell the Fort Frances mill including the requirement that the owner of this facility will not interfere directly or indirectly with Resolute’s relationship with the MNRF.
April 1, 2020; The Boundary Waters Forest was formed from the merging of the Sapawe and Crossroute Forest. Boundary Waters Forest Management Corporation took over the management of this new forest, under the existing Crossroute SFL.
September 2020; The MNRF amended the Crossroute Forest License, expiring in 2032, by deleting Resolute Forest Products and inserting Boundary Waters Forest Management Corporation and by deleting the allocation of wood from the Crossroute Forest to the Fort Frances mill.
From May 2014 through to September 2020 the Crossroute Forest Licence allocated the wood to the Fort Frances mill. Newspaper articles, the Boundary Waters Forest Management Plan, and the Town of Fort Frances all indicate a new Sustainable Forest License would be granted to the Boundary Waters Forest Management Corporation. In fact the MNRF just amended the existing license the Lieutenant Governor in Council extended in 2017. Based on the foregoing, I hope the Town of Fort Frances will, at minimum, seek a judicial review of the MNRF’s application of the Crown Forest Sustainability Act. Unfortunately it is too late to preserve the value of the Fort Frances Pulp and Paper mill, the economic engine of the Rainy River District for over a hundred years.
Thank you,
David Kircher
