Kaweraus Tasman paper mill production finishes, clean up begins

The mood is “sombre” inside Kawerau’s Tasman paper mill as production grinds to a halt for the final time.

Newsprint production stopped yesterday and workers are now preparing the mill to hand over assets to any potential buyers including the plant and equipment.

Mill workers will still be employed until at least mid-July to help with the cleanup.

Gary Maxwell, who has worked at the mill for 20 years as a contractor, told NZME this morning there was a “sombre” atmosphere yesterday ahead of the final shut down.

“You know it’s coming, but it’s different when you see it actually start to happen.”

Maxwell travelled in from Taneatua for work and said it was business as usual until the handover.

Wendy Rowles who had also worked at the mill for 20 years said while it was sad, it had been a long time coming.

She worked as a business analyst for the company and said she would be there until the end, and would probably need to find work out of town due to her field.

She said there would be a financial toll but it was out of anyone’s control.

A local man, who didnt want to be named, said there was hope amidst the closure.

“We heard there are only 28 people who actually live in Kawerau that work there … I think we’ll be alright.”

The mill closed due to the decline in the mill’s sole product, newsprint, exacerbated by the Covid-19 epidemic lockdowns.

The mill has seen a structural decline in the market in both its export and domestic markets.

All 160 staff made redundant will receive their full entitlements which are being funded through proceeds from the sale.

But what happens to the assets and space will be up to any potential new owner.

The initial clean-up and transition process will take around two weeks and the first group of employees will leave on July 16.

The remaining employees will continue the clean-up tasks and transition processes through to August before their employment ends.

The timing of this depends on when the asset sale transactions are finished.

The confidential negotiations and process around the sale of mill assets will continue over the coming months and be completed as soon as possible, a spokesman said.

The timing of the handover of the JV/shared services will depend on who buys the assets and the terms of the sale agreement.

Tasman Mill general manager Steve Brine thanked all employees for their contribution to the company and said the focus over the coming months was to clean-up tasks safely and effectively.

The Tasman Mill began newsprint production in 1955 and has produced more than 15 million of tonnes of paper during its 66-year history.

Norske Skog will continue to manufacture newsprint and other publication paper at its Boyer Mill in Tasmania which will continue to supply customers across Australia and New Zealand.

Pulp and Paper Workers Union secretary Tane Phillips said staff had been getting support through budget and financial advisors and job placement assistance.

He said the mill shut last night and staff would be focused on the final clean-up and then planning for their future.

He was with them for the final shutdown.

History

The town originated from the decision in 1951 by the government and the Fletcher group to form the Tasman Pulp & Paper Company Limited as a joint venture.

An integrated pulp and paper mill was built at Onepu, near the Tarawera River and a town of 3500 people was planned nearby.

By October 1953 the first house was built and newsprint production began two years later.

The name Kawerau was chosen for the new town as the result of a competition.

Town funding

In February last year, a $19.9 million investment from the Provincial Growth Fund which would create 150 jobs in Kawerau was described as the start of a new era in the town.

The Kawerau Container Terminal was said to get $9.6m cash injection, the Putauaki Trust roading extension and infrastructure to get $7.5m, and the Kawerau Off-Highway Road a $2.8m investment.

In 2018, the Putauaki Trust Industrial Hub received $2m for the first stage of construction.


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