The Vernon, B.C., company says increased customer demand and "sustained improvements in the U.S. housing market" signal that it's now economically viable to restart the engineered wood products mill.
The mill is expected to employ about 150 workers and is slated to begin production by the first quarter of 2014.
Privately held Tolko is a producer and marketer of lumber, veneer, plywood and other wood products.
It has a number of operations in B.C., Alberta, Saskatchewan and Manitoba.
Tolko president and CEO Brad Thorlakson says the company is "confident about the future of the industry."
"Reopening Athabasca confirms our commitment to meeting the needs of our customers through innovation and product development," he said in a release.