Plans Unveiled for Former Espanola Mill Redevelopment

A property redevelopment firm has purchased the closed pulp and paper mill in Espanola, a year and a half after Domtar halted operations at the facility and laid off 450 workers.

Tillsonburg-based BMI Group announced their acquisition on Thursday, while Domtar mentioned that finalizing the sale is still “subject to customary regulatory approvals.”

Domtar stated it ceased operations at the mill due to “years of ongoing operating losses and high costs associated with maintaining and operating.”

The Espanola mill currently employs 32 people who have been responsible for managing and maintaining the site.

BMI Group says it’s prepared to begin “re-futuring” the Espanola mill, which they describe as retooling infrastructure for new uses.

The company indicated they have successfully completed similar projects in Ontario, Quebec, and Michigan.

BMI Group was also involved in redeveloping the St. Mary’s paper mill in Sault Ste. Marie and now owns the former Abitibi paper mill in Iroquois Falls.

Paul Veldman, one of three brothers who own BMI, says they were drawn to the Espanola mill because of its “striking” and “picturesque” location along the Spanish River, as well as its “significant square footage.”

He notes they will take a “close look at what could go in which part of the mill,” but are definitely focused on exploring opportunities to continue processing forest products there, including paper or new types of biofuels.

The Domtar paper mill in Espanola shut down on Nov. 30, 2023 leading to hundreds of workers in the northern Ontario town being laid off. (Erik White/CBC )

“We believe that’s tremendously important,” said Veldman, BMI’s CEO.

“We are actively in discussions with several groups looking at putting the wood back to work.”

He mentions it would be “ambitious” to claim they can restore all 450 jobs lost when Domtar closed down, but their aim is definitely to create more jobs and support nearby sawmills that used to supply chips to the Espanola paper plant.

Veldman points out that like other former mills they’ve purchased, there are “environmental challenges,” including an on-site landfill that they’ll need to collaborate with the province on executing a “closure plan.”

‘Excellent news for Espanola’: mayor

Espanola mayor Douglas Gervais says BMI group introduced themselves during a meeting last month and believes that closing a deal with Domtar is fantastic news.

“They told us their specialty is in bringing businesses together so we can hopefully attract more than one industry,” he said.

Gervais states he’s unsure if BMI plans to operate any kind of pulp or paper production from this mill. “They did not specify whether they were going to be bringing that back.”

Douglas Gervais is the mayor of the town of Espanola. (Aya Dufour/CBC)

In line with this thought, he finds it difficult to predict how many jobs might return under this new company.

“There will be jobs; obviously they’re going to need some help,” he said. “This is our hope, certainly. But we can’t say right now.”

“I’m expecting people will be excited about this-just as excited as I am! Instead of looking at something that’s dead and not moving forward, this brings excitement back into our community.”

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