AV Cell receives funding for biogas production

November 25, 2013, Edmundston, N.B. — AV Cell Inc. of
Atholville, New Brunswick, received $12 million in federal funding for capital
upgrades to treat two mill effluent streams using an anaerobic process.

This investment by the Government of Canada is the final
installment of support from the $1-billion Pulp and Paper Green Transformation
Program (PPGTP).

This form of effluent treatment will allow the mill to
produce more renewable energy through the combustion of biogas, thereby
offsetting consumption of fossil fuels and reducing emissions.

“Our government recognizes that the forest sector remains an
important economic driver for Madawaska-Restigouche, and we are committed to
the ongoing transformation of our forest industry,” said Bernard Valcourt, minister
of aboriginal affairs and northern development.

In addition to the direct environmental benefits of PPGTP
projects, the program has helped generate new investments that are making
Canadian pulp and paper facilities more sustainable and more competitive. In
total, the program has provided funding for 98 projects in 38 communities and
supported more than 14,000 jobs. Together, these projects are producing enough
renewable energy to meet the equivalent of the annual power needs of all of the
houses in Calgary, Alberta. In some cases, mills are expanding their revenue
streams by selling their surplus energy to the grid. The renewable electricity
generated by PPGTP-funded projects is expected to create $149 million annually
in revenues for Canadian pulp and paper mills.

Collectively, these projects are expected to directly reduce
greenhouse gas emissions of the Canadian pulp and paper sector by more than 10
percent, and communities are benefiting from improved air emissions and reduced
noise from mills.

The AV Cell Inc. project is one of 16 PPGTP-funded projects
announced recently by the Government of Canada, representing a total investment
of $109.2 million.