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Natural Resources
August 28, 2009

Bonavista Peninsula Sawmill Industry Boosted with $2.25 Million Investment

A significant multi-million dollar investment by the Provincial Government towards the modernization of the Sexton Lumber Company�s sawmill in Lethbridge, Bonavista Bay will position the operation for expansion and diversification.

"This investment demonstrates our confidence in the recovery of the forest industry," said the Honourable Kathy Dunderdale, Minister of Natural Resources and Minister Responsible for the Forestry and Agrifoods Agency. "Sexton Lumber has worked hard to maintain its lumber production in tough economic times. With this funding, we are supporting this company�s strategy of continuous improvements in their operation, which may lead to new product and market development opportunities and additional employment."

The company will receive a $2.25 million non-interest term bearing loan under the Forest Industry Diversification Program. This investment will maintain 70 jobs directly associated with Sexton Lumber, and another 105 indirectly within the forest sector on the Bonavista Peninsula. The loan will be repaid over a 15 year period. The investment will help the company�s long-term plan to modernize its sawmill and make the operation more efficient and productive.

"This investment, and all the projects supported under this diversification fund, will have a very positive effect on the forest industry in the province," Minister Dunderdale said. "It is important for all sectors of the forest industry to be economically viable and be able to compete globally. The forest industry is integrated in many ways, resulting in the whole industry being impacted by a decline in one sector. Ensuring the competitiveness of our producers can only strengthen the entire industry."

"This investment is making a local family-owned business more competitive by acquiring state of the art equipment that will provide maximum yields from every log purchased," said the Honourable Roger Fitzgerald, MHA for Bonavista South. "This will help Sexton Lumber to sustain the existing workforce and provide new employment opportunities."

"This is a tremendous day for our forest industry and for our company," said Kevin Sexton, President of Sexton Lumber Company. "Government�s commitment to this sector provides us with an opportunity to modernize our operation and to position it for expansion and diversification."

This is the third funding announcement this month under the Forest Industry Diversification Program. The Provincial Government has invested $10 million in Holson Forest Products on the Northern Peninsula for a wood inventory yard, sawmill expansion and wood pellet manufacturing plant, and $500,000 for plant modernization at Burton�s Cove Logging and Lumber Limited in White Bay.

The Forest Industry Diversification Program was established in Budget 2008 to help the provincial sawmill sector modernize and diversify, and to provide sawmill operators with capital to acquire new infrastructure, technology and equipment to support innovation and modernization of the industry.

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Media contacts:

Tracy Barron
Director of Communications
Department of Natural Resources
709-729-5282, 690-8241
Donna Abbott
Executive Assistant, Hon. Roger Fitzgerald, Bonavista South MHA
Kevin Sexton
Sexton Lumber Company

2009 08 28                                                     11:45 a.m.

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