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Natural Resources
August 25, 2009

Province Makes Another Significant Investment in Sawmill Industry

The Provincial Government is continuing its support of the province�s sawmill industry with an investment of $500,000 in plant modernization for Burton�s Cove Logging and Lumber Limited in White Bay. This is government�s second direct investment in sawmill operations through the Forest Industry Diversification Program this month.

"It�s important to pursue opportunities for forest industry expansion and diversification in response to the changing market demands," said the Honourable Kathy Dunderdale, Minister of Natural Resources and Minister Responsible for the Forestry and Agrifoods Agency. "Through this investment, we are maintaining employment for this company�s employees and helping to ensure an economically-viable future for the sawmill sector."

Burton�s Cove Logging and Lumber Limited will receive $500,000 in the form of equity financing to assist with the purchase and installation of new equipment and to modernize the plant, ensuring the continued employment of the company�s 42 full-time employees. Modernization will enable the company to increase its lumber processing capacity, which will lead to increased productivity, efficiency and revenue. With this investment, the Provincial Government is purchasing 10 non-voting common shares in the company, each valued at $50,000. Redemption of the shares will occur over a five-year period, beginning in 2016.

"I am extremely pleased with this announcement in support of the sawmill industry in my district," said Darryl Kelly, MHA for Humber Valley. "Once again, it shows our government's commitment to rural communities and to the logging industry."

"We are extremely pleased with this investment in our company and in the forest industry in this region," said Fred Osmond, owner/operator of Burton�s Cove Logging and Lumber. "This funding enables us to modernize our plant so that we are able to compete in this market."

Last week, the Provincial Government announced its investment of $10 million in Holson Forest Products on the Northern Peninsula as part of the ongoing commitment to the province�s sawmill industry through targeted investment. The Forest Industry Diversification Program is designed to identify areas for growth and diversification, as well as new market opportunities. Funding under this program provides sawmill operators with capital for new infrastructure, technology and equipment towards industry innovation and modernization.

"Our companies must have the ability to compete in a changing global environment to ensure the continued sustainable development of our forest industry," said Minister Dunderdale. "Together with industry, we are building on the past successes of these companies to ensure the long-term viability of this sector."

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Media contacts:

Tracy Barron
Director of Communications
Department of Natural Resources
709-729-5282, 690-8241
Paula Barrett
Constituency Assistant for Darryl Kelly, MHA Humber Valley
709-635-0132, 1-877-635-0132
Fred Osmond
Burton�s Cove Logging and Lumber Limited

2009 08 25                                                     12:30 p.m.

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