Ontario Invests C$2.5 Million in Northwestern Forestry Projects

The Ontario government is providing more than C$2.5 million through its Forest Biomass Program to support three forestry projects in northwestern Ontario, including planned process upgrades at Thunder Bay Pulp and Paper.

Thunder Bay Pulp and Paper will receive C$2.4 million to develop plans for boiler and chemical plant upgrades. According to the province, the proposed improvements could increase the mill’s daily kraft production by 11%.

The upgrades are also expected to create demand for more than 130,000 tonnes of forest biomass annually, including mill by-products and underused wood. Ontario said the project would support more than 700 direct jobs and more than 3,350 indirect jobs.

The remaining funding includes C$92,500 for AUX Energy to develop plans for a biomass-powered generator project in Fort Frances, aimed at increasing energy security, and C$32,650 for Weyerhaeuser to study production-line upgrades at its Kenora operation to reduce costs and improve efficiency and product quality.

The investment comes as northwestern Ontario’s forest products sector faces continuing market and operating challenges. Thunder Bay Pulp and Paper announced in January that it would discontinue newsprint production because of declining demand, affecting 150 workers. The Ignace sawmill shut down indefinitely in March, while the Ear Falls sawmill has been idle since October 2025. The Terrace Bay mill has been idle since January 2024.

Norm Bush, CEO of Thunder Bay Pulp and Paper, said the provincial funding will support evaluations of three major projects requiring significant capital investment.

“We've got a very abundant fibre supply, we have abundant power, and we're blessed with being in very close proximity to most of our customers,” Bush said.

The funding is being announced amid continuing trade pressure on Canadian forest and paper products from the United States. Ontario said the Forest Biomass Program is intended to strengthen and diversify the province’s forest sector and increase the use of available biomass.