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Nanaimo Forest Products to Sell Power to BC Hydro

Nanaimo, British Columbia, Canada, 17 January 2012 -- Starting in 2013, Nanaimo Forest Products Ltd. will be generating and selling clean power to BC Hydro. Under its integrated power offer, BC Hydro has signed a 15-year electricity purchase agreement with Nanaimo Forest Products to purchase clean energy from a new 25 megawatt turbo-generation unit that is being constructed at the Harmac Pacific pulp mill, located just south of Nanaimo, British Columbia.

The new turbo-generation unit will produce electricity from wood biomass. Efficiencies within the pulping process using recaptured steam energy will help power the generator. Upgrades also will be made to the pulp mill's boiler and hog fuel-handling system.

Construction is expected to last 18 months. Once complete, the new generating project is expected to produce 190 gigawatt hours of electricity annually for sale to BC Hydro, or enough to power more than 17,000 homes. Additionally, Nanaimo Forest Products will be implementing various energy efficiency projects resulting in 11 gigawatt hours per year of electricity savings.

Funding for the series of upgrades was made possible from Natural Resources Canada's Pulp and Paper Green Transformation Program (CAD 27 million) and BC Hydro's Power Smart Partners Industrial Program (CAD 1 million for a vacuum pump system upgrade). BC Hydro is also helping fund an energy manager at Nanaimo Forest Products who will develop and lead a sustainable energy management plan for the company focused on continuous energy improvement.

"Investments in power generation facilities can be capital intensive. Support from the provincial and federal government and from BC Hydro underlines their commitment to help business thrive in British Columbia and their commitment to energy conservation and green energy generation," said Levi Sampson, president, Nanaimo Forest Products. Revenues from power generation will improve Nanaimo Forest Products' business model by incorporating a fixed revenue stream that is isolated from the volatility of the pulp market.

Nanaimo Forest Products operates the Harmac Pacific pulp mill in Nanaimo, British Columbia, which produces world-class northern bleached softwood kraft pulp.


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