Sturgeon Falls forges on.

In struggling to recapture its industrial base following the December closure of the Sturgeon Falls Weyerhaeuser mill, West Nipissing is putting the building blocks in place to pursue economic prosperity once again.

"We've certainly been active in trying to create economic opportunities," says Royal Poulin, chairman of the West Nipissing Community Adjustment and Recovery Committee (CARC) entrusted with finding a new economic direction for the municipality of 13,650.

About 140 former Weyerhaeuser employees lost their jobs when the company closed the Sturgeon Falls containerboard mill Dec. 6, 2002.

The acquisition of a hydroelectric power dam from Weyerhaeuser by the municipality is expected to be complete this fall.

West Nipissing Mayor Gary O' Connor views the acquisition of the Weyerhaeuser dam as its competitive edge in its toolbox to lure any potential new business to town.

The deal included 48 hectares of industrial land along Highway 17 and in the Bay Street-Leblanc Road area.

O'Connor says acquiring the power plant and land secures the assets to assist in future diversification and development of West Nipissing to attract new business to Sturgeon Falls.

He says the deal, which has yet to be finalized, resulted in a $100-million lawsuit filed by the West Nipissing Economic Development Corp. in relation to the mill closure being dropped.

Poulin, who is also chairman of the Ontario Northland Transportation Commission, expects the dam to be in the town's hands by October, once legal work is completed. Weyerhaeuser agreed to sell the dam to the municipality in early July.

After that, it will be up to West Nipissing council to decide how the plant will be administered, operated and how the power generated will be best used.

Currently the power generated becomes part of the Ontario grid, and will continue as such until a legal operating structure is created by the town, says Poulin.

The dam produces 7.4 megawatts per year, but there is a plan to increase production to 11 megawatts.

Poulin says a preliminary engineering report indicates the dam is in good physical shape and the option to increase power production will be up to council.

"We know we can increase the amount of energy this dam can create, and that will be the next step after we have all the legal agreements signed."

In the meantime, the community has applied for provincial funding for the purchase and upgrade of the dam and expects an announcement from Queen's Park to be made soon, says Poulin.

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No decision has been made by Weyerhaeuser to transfer the main mill site, though the forest products giant had been entertaining offers.

Officials with the Communications, Energy and Paperworkers Union are working with potential investors to buy the mill, but all parties have signed confidentiality documents and are limited in what can be said.

Larry Lemon, a Weyerhaeuser spokesman in Dryden, says there is no change in the mill's status. The agreement in principle to sell the power plant to the municipality is still proceeding and talks are continuing on that, "and any talk of selling the mill site would be bound by a confidentiality agreement, so we can't discuss it with the parties involved."

In June, the community adjustment and recovery committee unveiled its strategy to strengthen the local economy and attract new business. The $145,000-plan, which recommends 31 possible projects, was the result of extensive public consultation and was funded jointly by the municipality and the provincial and federal governments.

Among the action items recommended is a pelletized biofuel facility. The report states technology is currently under development by Dell-Point, a Montreal manufacturer of pellet stoves, for efficient slow combustion ovens using switch-grass as fuel. Poulin would only say the committee is "working on various front and have had discussions with people in that field."

By IAN ROSS 

Northern Ontario Business