Quebec again invests in Kruger paper mill for $386 million in projects at two plants

The Kruger paper mill in Trois Rivieres Que. is one of two that received a health dose of investment from the Quebec government. THE CANADIAN PRESS/Jacques Boissinot

MONTREAL — The Quebec government is again investing in the Kruger paper mill for projects estimated at more than $386 million, in particular, to accelerate its shift towards the manufacture of tissue paper.

Investissement Quebec (IQ) will lend the company $165 million to relaunch the Brompton site in Sherbrooke, which was slated to close last September. The estimated $240-million project involves setting up production lines for toilet paper and facial tissue.

Minister of Economy and Innovation Pierre Fitzgibbon announced Friday it should create 169 jobs by 2025.

At the same time, $146.1 million - of which $34.8 million will come from the financial arm of the Quebec government - will be deployed to modernize the Wayagamack coated paper plant located in Trois-Rivieres, which should make it possible to maintain 294 jobs and secure the employee pension plan.

Kruger, which has received state support on more than one occasion in recent years, said operations at its new Sherbrooke tissue mill, a $575-million project announced in 2018, had started.

About 180 workers are expected to be hired.

The Legault government explained that it worked for several months with the company to "arrive at a repositioning plan" for the Brompton plant as well as the modernization of the Wayagamack site.

In the fall economic update, Quebec signalled that it did not necessarily expect to review the $125-million loan to Kruger for its proposed tissue paper manufacturing plant in Sherbrooke.

Kruger, headquartered in Montreal, has more than 5,000 employees, including at least 2,600 in Quebec. The company operates 20 sites - 12 in the province, seven in the rest of the country and one located in the United States.

-- this report by The Canadian Press was first published Feb. 26, 2021.