By Matt Scace
Published Mar 19, 2024
Last updated Mar 20, 2024
A year-old Calgary rail company has purchased the assets of a former Canfor pulp mill in northeastern British Columbia, with plans to turn it into a distribution hub for energy, agriculture and forestry industries.
Buffalo Rail and Infrastructure said Tuesday the $7-million acquisition will see the company take over Canfor Pulp Products Inc.’s 300-acre industrial property in Taylor, B.C., a 1,300-person community between Fort St. John and Dawson Creek.
The mill previously produced bleached chemi-thermo mechanical pulp used in packaging and tissue products. Canfor temporarily closed the plant in late 2021 and extended to the beginning of 2023, citing “a reduction in the long-term supply of fibre in the Peace region.”
The company’s CEO said the Coastal Gaslink pipeline, expected to come online in 2025, is going to draw large inbound and outbound demand for energy products in the area. “(The site) is in a prime location to facilitate the movements of commodities in and out of an area that is having an economic boom with respect to energy,” said Buffalo Rail CEO Jarrett Zeilinski.
Buffalo Rail will be focusing on improving the supply chain for frac sand into northeast B.C., which Zeilinski said currently lacks streamlined transportation infrastructure needed to transport the material. (Frac sand is the material injected into a rock formation with water in the process of hydraulic fracturing, informally known as fracking — a method used to extract natural gas and oil from deep rock formations.)
While there are several rail facilities in northeastern B.C., Zeilinski said they’re not large enough to accommodate the volumes arriving to the area. As a result, trucks are often deployed to make round trips between northeast B.C. communities and Grande Prairie.
Buffalo Rail said the first phase of development will bring in 100 construction jobs and 30 full-time jobs — part of its $50 million investment in the area over the first phase, it said. Zeilinski said the site “may eventually employ hundreds of people.”
Buffalo Rail was created in 2023 “by a diverse team of logistics industry veterans to capitalize on global shifts in supply chain strategy.” It is a sister company of Torq Energy Logistics Ltd.
Canfor announced earlier in March it had sold the property to an unnamed buyer. Canfor for several years has referred to struggles accessing fibre needed to support its operations in B.C.
Last year the forest products company closed its pulp mill in Prince George, B.C., resulting in layoffs of more than 200 people. The company at the time cited a lack of fibre needed to sustain operations. It has also closed its Chetwynd sawmill for the same reason in the past year.
Canfor reported a net $117-million loss in the fourth quarter of 2023, resulting in a total $532-million operating loss in 2023.
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