Saturday, February 16, 2008

TEMBEC Purchasing New Whole Log Chipper

FRM Purchase of New Whole Log Chipper memorandum
Cranbrook Office
PO Box 4600
Cranbrook BC V1C 4J7

To: Ian Lind, Bernie Macala, Roland Kemperman
Cc: JL Carriere

From: Troy Hromadnik
Date: February 14, 2008
Subject: FRM Purchase of New Whole Log Chipper

On February 1st of this year, Tembec’s Forest Resource Management Group, Western Canada Division, received some very positive news. Mr. Dennis Rounsville, Tembec’s Forest Products Group President, approved in principle, the purchase of a new whole log chipper (WLC) for use in the East Kootenay business unit.

The new WLC is a much-needed asset that will provide an additional supply of chip fiber to Tembec’s pulp mill in Skookumchuck. As a result of very challenging lumber markets and to mitigate sawmill financial losses, Tembec has recently announced and scheduled mill downtime for its Elko and Canal Flats processing facilities. To accommodate for the loss in chip fiber associated with these planned shutdowns and potential chip losses from other industry sources, an alternate supply is required to meet Skookumchuck’s scheduled needs. The WLC is well suited to meet this challenge as it will enable the incremental use of pulp logs available on our tenures.

The scheduled start-up date for the WLC is February the 21st, with full production planned for the week of February 25th. The WLC will employ nine (9) new employees, will be operated on a two-shift basis and will consume an estimated 5,200 cubic meters per week (2,000 BDT chip production equivalent).

This investment will enable the facilitation of “ regional profitability”, will accommodate chip production losses as a result of planned mill downtime and will ensure Skookumchuck’s forecasted fiber needs are met. The new WLC is a welcome asset to the region.

For further information, please feel free to contact the following:

·Troy Hromadnik, FRM, Vice President, Western Canada Division
(250) 426-9246

· Jean-Luc Carriere, SPF, Vice President, BC Division
(250) 426-9205
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