09/10/2011 11:54 EDT | Updated 11/10/2011 05:12 EST

First of two paper machines idled at NewPage mill in Cape Breton: union

PORT HAWKESBURY, N.S. - The union that represents workers at an embattled Cape Breton paper mill says one of the factory's newsprint machines was idled early Saturday.

Archie MacLachlan, the first vice president at Local 972 of the Communications, Energy and Paperworkers union, says he'd received word that as of 8 a.m. the paper machine — one of two at the plant — had stopped producing paper at the NewPage mill in Point Tupper.

He says it's the first stage in an indefinite shutdown that will eventually lead to the idling of both machines and the layoff of up to 600 workers directly employed at the mill.

"I had a chance to talk to folks on the paper machine and they did shut down," he said in a telephone interview from Port Hawkesbury.

"They're going through a process of draining all the storage tanks and flushing out the lines so they'll be ready to restart whenever they get the call to fire her back up."

The company was granted protection from creditors on Friday and the court-appointed monitor said a search is underway for a new owner to operate the plant.

A spokeswoman for NewPage Port Hawkesbury was unavailable for comment on Saturday.

The NewPage mill has operated in Nova Scotia since the early 1960s, and is a mainstay of the community on the Strait of Canso.

As of late this spring, the newsprint machine had the capacity to produce 190,000 tonnes of standard and improved newsprint, according to a company news release.

The second machine, used to make coated papers, has a capacity for 360 000 tonnes of paper for the catalogue and magazine paper markets.

The news release said the company's woodlands unit manages approximately 600,000 hectares of Crown land in seven Nova Scotia counties and an additional 20,020 hectares of company-owned land.

MacLachlan says the indefinite closure is difficult for workers' families as they await word on whether a new buyer can be found to restart the plant.

"The pain is in the uncertainty," he said.

Still, MacLachlan also said the situation is very fluid, and he remains hopeful that despite heavy losses and depressed markets for newsprint there's hope the mill will reopen with a new owner.

Port Hawkesbury Mayor Billy Joe MacLean said in an interview that he met with retirees from the plant today who are very worried about unfunded pension liabilities.

The mayor said there are concerns that if the plant doesn't restart and pensions are wound up that the retirees will have to live on reduced incomes.

"Ones who are retired could get hit with reductions ... in their pension incomes, and that's people who have been retired 10 years," he said.

The mayor said he's been told by the province and the company that there is a potential buyer for the mill.

"We're sitting down here praying that a lot of this is factual and the intentions are good. We must be that way. We're trying to be as positive as possible.

However, MacLean also said he's heard that if a new owner purchases the plant they wouldn't necessarily start up the newsprint machine due to depressed markets for that product.

— Story by Michael Tutton in Halifax