EDMONTON, AB, Nov. 28, 2016 (CNW) -Acting on behalf of a syndicate of buyers under the Sundance C Power Purchase Arrangement (PPA), including Millar Western, Capital Power Corporation (Capital Power) has announced that Capital Power and the Government of Alberta (the Province) have agreed to settle the PPA dispute. Under this settlement, the termination of the PPA will be accepted, thereby ending all of Millar Western's obligations associated with the PPA.
Under its agreement with Capital Power, the Province will arrange for the Balancing Pool to accept Capital Power's termination of its role as a buyer of the PPA, in accordance with the terms of the PPA. Capital Power and its syndicate partners have agreed to pay the Balancing Pool $39 million, of which Millar Western's portion is $4.3 million. Millar Western will include this payment in its fourth-quarter and year-end financial results.
In 2000, Millar Western joined a multi-party syndicate headed by Capital Power to enter into the PPA, which took effect January 1, 2001. In March 2016, Capital Power announced it intended to exercise its right to terminate the PPA. The Province subsequently disputed the validity of Capital Power's termination of the PPA.
About Millar Western Forest Products Ltd.:
Millar Western is a family-owned forest products company headquartered in Edmonton and operating a high-yield pulp mill in Whitecourt and dimension lumber mills in Whitecourt and Fox Creek, Alberta.
SOURCE Millar Western Forest Products Ltd.