Bio-Insight

The pulp machine upgrade will allow Hinton Pulp to produce more pulp with greater energy efficiency and produce additional energy. The additional energy will be enough to power approximately 720 average homes. The mill's natural gas consumption is expected to be reduced by more than 55,000 gigajoules per year and greenhouse gas emissions are expected to be reduced by more than 2,750 tonnes annually. As a result of this project and other initiatives, pulp production is expected to increase to 420,000 tonnes, returning the mill to levels achieved when the mill ran two production lines. The successful completion of this project is expected to be an important step for Hinton Pulp in improving its overall competitiveness and long-term outlook.

This News Release contains certain forward-looking statements about potential future developments, in particular those relating to the anticipated benefits from the Hinton Pulp machine energy efficiency project. These are presented to provide reasonable guidance to the reader. Their accuracy and the actual achievements of such benefits depend on and are subject to a number of assumptions, risks, and uncertainties and other factors. Accordingly, readers should exercise caution in relying upon forward-looking statements and West Fraser undertakes no obligation to publicly revise them to reflect subsequent events or circumstances except as required by applicable securities laws.

West Fraser is an integrated wood products company producing lumber, wood chips, LVL, MDF, plywood, pulp and newsprint. The Company has operations in western Canada and the southern United States.

West Fraser shares trade on the Toronto Stock Exchange under the symbol: "WFT".

St. Marys Renewable Energy Corporation will operate the new plant, contracted to supply 30 megawatts (MW) of electricity. About 555 direct and indirect jobs will be associated with the project, which is expected to reach commercial operation by early 2014.

The plant's primary fuel source will be biomass including bark and waste wood. The heat it provides will be used in the mill's industrial processes, and the electricity that is not used by the mill will be sold to the grid.

"We are delighted to announce this contract," said Ontario Power Authority Chief Executive Officer Colin Andersen. "We recognize the strategic importance of this project to the mill and to Sault Ste. Marie, and we are glad we could reach an agreement that works for St. Marys and serves Ontario ratepayer interests."

"We want to thank everyone who has worked so hard on the project design, the application process, and the approval process," stated Dennis Bunnell, CEO of St. Marys Paper Corp. "The efforts expended to this point have been enormous. St. Marys is now in a position to step into the twenty-first century while looking confidently toward the future. We plan to finalize the funding and begin construction in 2011. Everyone involved in St. Marys is excited to be part of the province's renewable energy initiatives."

"Our government has provided loans for St. Marys Paper in order to protect local jobs and revitalize the forestry sector, and this new provincial power agreement makes it possible for the mill to build a biomass co-generation plant, which will provide it with long-term stability and greater job security for its workers," said David Orazietti, MPP for Sault Ste. Marie. "A biomass-fuelled co-generation plant creates a cost-effective energy alternative that can supply the mill with enough power to be self-sustaining and positively impact the environment by decreasing green house gas emissions."

Recognizing the importance of a secure biomass supply to the success of the project, St. Marys has negotiated a commitment of up to 400,000 tonnes of biomass annually from the Algoma and Northshore Crown Forests for the life of the project.

The project will meet all Ontario Ministry of the Environment requirements. The biomass boiler technology chosen for the project, a bubbling fluidized bed boiler, will lower overall emissions. Existing boilers at the mill will be decommissioned, thereby improving emissions per tonne of fuel consumed.

The Ontario Power Authority and St. Marys have been in negotiations since August 2009, working to secure an agreement after the company submitted an initial bid in the OPA's combined heat and power (CHP) III procurement process for projects using renewable energy.

About St. Marys:

St. Marys Paper Corp. operates a 220,000 tonnes per year groundwood pulp and supercalendered paper mill in Sault Ste. Marie, Ontario. Formed in 2007, St. Marys Renewable Energy Corp. was created to develop biomass co-generation capacity in conjunction with the operations of St. Marys Paper Corp. It is the key project leading the company's planned transformation into the bio-economy.

About the OPA:

The Ontario Power Authority is responsible for ensuring a reliable, sustainable supply of electricity for Ontario. Its key areas of focus are planning the power system for the long term, leading and co-ordinating conservation initiatives across the province, and ensuring development of needed generation resources.

Domtar will receive $700,000 in funding under the Pulp and Paper Green Transformation Program (PPGTP) to replace the aerators at its mill in Espanola with more energy-efficient models.

"Investments in projects like this demonstrate our government's commitment to helping the forestry sector develop greener and more sustainable solutions," said the Honourable Christian Paradis, Minister of Natural Resources. "This is a good example of how government investments in energy-efficient technologies are lowering the environmental impact of Canada's forest industry and establishing the groundwork for a renewed, more competitive sector."

The new equipment will improve air quality and will require less energy, reducing the mill's electrical power consumption by 3,500 MWh/year.

"We are pleased to move forward with this important upgrade, which will help us conserve energy," said Tim Houle, manager of the Domtar Espanola pulp and paper mill. "We thank the Government of Canada for investing in our industry and in our community."

Domtar is one of 24 pulp and paper companies across Canada that qualified for credits under the $1-billion PPGTP program based on their 2009 production levels of black liquor, a liquid by-product of the pulping process used to generate heat and power. Today's funding announcement marks the second allotment of PPGTP credits to Domtar Espanola. In June, the mill received $995,000 to install a refurbished wood waste grinder that will allow the mill to process bark more effectively for the production of renewable energy.

Today's announcement complements and builds upon the success of many initiatives in Canada's Economic Action Plan that are helping enhance Canada's forestry industry and sustain jobs in the communities that depend on it. Budget 2010: Leading the Way on Jobs and Growth established the $100-million Investments in Forest Industry Transformation program to promote the development, commercialization and implementation of advanced technologies in the forest sector - helping create a world-class industry able to compete in the clean energy economy of tomorrow.

In addition, the Government of Canada has committed $170 million to assist the development of next-generation forest products and expand global markets for Canadian forest products. This funding includes $40 million to develop pilot-scale demonstrations under the Transformative Technologies Program.