Kenora Forest Products can cut wood and the Kenora iLevel Weyerhaueser plant can cut its energy costs thanks to successful applications announced Thursday night.

Minister of Northern Development, Mines and Forestry Michael Gravelle revealed Weyerhaueser was successful in its application to the Northern Industrial Electricity Rate Program, which is expected to add $5.8 million to its bottom line over the next three years. Designed to offset high energy costs and keep Ontario competitive with neighbouring provinces and states, the program gives a two-cent per kilowatt hour electricity rebate to companies committing to the preparation and implementation of comprehensive energy management plans.

"This is an example of one of the areas where the McGuinty government feels energy costs could be a real cost for northern industrial resource-based industries so by introducing an industrial energy rate for Northern Ontario paper and mining sectors, we're able to help level the playing field for them," Gravelle said.

Bill Candline is the plant manager for Weyerhaeuser.

"This is a big help for us," he said. "We've developed an aggressive energy plan and that's what qualifies you for the rate program. The plan is we have a number of capital projects we're pursuing. We have some other funding and we're looking at how to reduce our use of electricity. There are some very technical projects we're looking at for some of the equipment in the plant. It's about trying to do the same amount of stuff we do with less electricity."

Idled Kenora Forest Products sawmill received an allotment of 101,000 cubic metres per year of spruce, pine and fir from the Kenora Forest, which Gravelle said will protect 98 jobs and add another 36. The latter figure is based on a solidified volume for the company's third shift.

Mill manager Rod McKay anticipates for every job protected or created, nearly three can continue to exist in bush work and spinoff business but was clear the wood allotment didn't mean Kenora Forest Products would be back in business without buyers for his product.

"I wish I had a crystal ball because it all depends on the U.S. market. The stud business is all in the tank because it's directly related to home building so that's really hurting us," he said. "Now we've got the wood. We're in there with oil cans and turning (machines) over to make sure they're warmed up and ready but we need a market to get it running."

Gravelle was confident Kenora Forest Products will find a foothold in a recovering U.S. market and placed his faith in the company's leadership.

"We award the allocation based on the commitments the company makes that they feel are realistic and I believe those commitments will take place," he said. "It's something we're very careful about. There have been other allocations we've made about opening up within a certain period of time. They believe the wood will be put to work — the whole basis of the application was to put the wood back to work — so we believe this is going to happen."

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