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EXCLUSIVE: Skeena Sawmills in Terrace lays off its staff amid operational challenges

Months after a temporary shutdown, Terrace’s major employer faces an uncertain future
Terrace’s Skeena Sawmills stands operational on July 3, 2020, three years before announcing a major round of layoffs amidst growing operational challenges. (Black Press Media file photo)

Skeena Sawmills has laid off most of its Terrace workforce as of Sept. 6, citing a shutdown due to continuing financial and operating difficulties.

It’s the latest blow to workers who have gone through intermittent openings and closures stretching back into 2021, but this time the company has issued official lay notices in line with its collective agreement with the United Steelworkers Union.

In a letter exclusively obtained by The Terrace Standard, Skeena Sawmills General Manager Lionel Chabot thanked workers for their understanding and wished them well.

“If you find alternate employment during this period and do not intend to return to work if recalled, please notify us immediately of your voluntary resignation,” he added in the letter dated Sept. 6.

Workers were also told to pick up any of their personal tools and belongings.

Up to 150 people are affected by this latest closure.

It is not immediately known how the adjacent sister pellet plant, Skeena Bioenergy, will be affected. It uses a combination of waste wood from the sawmill and waste from other sources.

The last extended closure took place in late 2022 and ended earlier this year when logs once more began to be delivered to the mill.

READ MORE: Skeena bioenergy and sawmill plant in Terrace resumes operations, eyes provincial aid

The company cited high operating costs, weak markets and an insecure fibre supply as reasons.

The closure announcement and layoffs continue a troubled history for the mill dating back to 2007 when it did not re-open following a lengthy strike by employees.

Owners West Fraser further clouded the mill’s future by announcing it was closing its Eurocan paper mill in early 2010, an operation that used waste from the Terrace facility.

Chinese investors purchased Skeena Sawmills and an accompanying forestry licence in 2011, leading to a re-opening in 2013.

The investors put as much as $50 million into the facility in updated equipment in the expectation of creating a more efficient and cost-effective operation.

An additional $20 million was then spent on building the Skeena Bioenergy pellet plant as a way of dealing with the sawmill’s waste and to provide another revenue stream.

Skeena Sawmills made efforts to obtain government grants to further improve the chances of its profitability and in February made a successful pitch to the City of Terrace for a letter of support in an application being made to the provincial government.

Company officials said they needed $17.5 million and in discussions with the provincial government, indicated they would be asking for between $2 million and $3 million from a specific program aimed at adding value to wood products.

With files from Rod Link

Viktor Elias joined the Terrace Standard in April 2023.

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