The paper mill in Kapuskasing, Ont., in 2017, then owned by Tembec. Current operator Kap Paper said late last month that it would have to idle operations.AARON VINCENT ELKAIM/The New York Times
The federal government says it can provide a $12-million loan to keep a northern Ontario paper mill from closing.
Jobs Minister Patty Hajdu says in a letter to Kap Paper that the federal operating support would be an “exceptional” one-time measure.
The company said late last month that it would have to idle operations at the Kapuskasing mill after failing to secure immediate financial support from Ottawa.
Northern Ontario paper mill to suspend operations, citing lack of federal support
Ottawa says it is offering supports to keep Ontario’s Kap Paper mill running
The federal government has said that it would keep working to save the mill, which directly employs about 420 people and supports 2,500 jobs in the region.
Hajdu says the $12-million repayable contribution to Kap Paper would come from two different federal programs, with conditions and expectations that the company will come up with a long-term strategy.
The Canadian Press has reached out to Kap Paper for comment on Hajdu’s letter.