Pulp mill powers BC

Nov. 17, 2010, Castlegar, BC – BC Hydro is now purchasing renewable electricity from the Zellstoff Celgar
Pulp Mill's Green Energy Project as a result of upgrades that allow the
pulp mill to direct more steam to energy production. A new 48-MW condensing
turbine is now generating electricity for use in the BC Hydro power grid.
Once the turbine is fully optimized, the pulp mill will produce enough surplus
electricity to power the equivalent of 20,000 homes.

The Zellstoff Celgar mill's cogeneration
facility will produce 238 GWh of electricity annually for sale to BC Hydro
under the terms of a 10-year electricity purchase agreement that was completed
as part of BC Hydro's Phase 1 Bioenergy Call. The new clean energy
generating capacity at the Zellstoff Celgar mill was made possible through a
series of upgrades funded by $40 million from Natural Resources Canada’s Pulp
and Paper Green Transformation Program and $17 million from Mercer
International, Zellstoff Celgar's parent company.

Investments at the mill include upgrading
the wood waste boiler and installing a new condensing turbine and other
steam-saving equipment, allowing the mill to generate energy surplus to its own
needs that it can sell to BC Hydro. The mill generates the steam it uses
for its operations by burning wood waste and black liquor, a byproduct of the
pulp-making process.

In total, BC Hydro's Phase 1 Bioenergy
Call will enable BC Hydro to purchase approximately 579 GWh annually from
four projects, which is enough to power more than 52,000 homes. In addition to
the electricity purchase agreement with Zellstoff Celgar, BC Hydro has
agreements with Canfor Pulp Ltd. Partnership in Prince George, PG Interior Waste
to Energy Ltd. in Prince George, and Domtar Pulp and Paper Products Inc. in
Kamloops.