NS: Wallboard plant needs new approach, says chamber

[POINT TUPPER, NS] — If there is a fourth attempt to produce wallboard at a shuttered plant here, a local business leader says he hopes it will be clear what will be done differently to ensure that the venture will be a success.

Efforts are currently underway by Nova Scotia Business Inc. to seek a new operator for the former Federal Gypsum facility. The beleaguered wallboard plant filed for bankruptcy last summer, owing about $32 million to more than 90 creditors — almost half of that to the provincial and federal governments. Among those who were out money following the shutdown of the plant are its former employees, who are collectively owed about $250,000 in back wages.

A request for proposals recently closed and NSBI is currently in talks with a potential operator. There is widespread speculation the proposal would again involve manufacturing wallboard. The agency hasn’t confirmed that, but the request for proposals did suggest a focus on an operator similar to what was there previously.

The Strait Area Chamber of Commerce has not taken an official position on the potential development, president John Ouellette said, noting the receivership process hasn’t been completed. “Generally, in terms of looking at how things have worked in the past, in terms of a wallboard plant operating, and having the number of operators, who have had various degrees of success, we would have general concerns about that,” he said. “We would really want to know if a new operator came in to produce wallboard, what are they going to do differently that’s going to allow it to be successful.”

Strait Area Chamber of Commerce President John Ouellette.

He added they’d also want to know details such as whether poor markets have improved, whether the proposed product has been changed, whether it has access to new markets, so that the plant would be able to offer long-term employment.

Under Federal Gypsum, the operation had never reached employment and production targets and it had first sought bankruptcy protection and debt restructuring. Prior to that, both Louisiana Pacific and US Gypsum produced related products there. “It’s not to say a wallboard plant couldn’t make a go of it,” Ouellette said, “we would just, from the business community, be really interested in what’s going to be different about that business case than the other three operators.”

Last month, The Cape Breton Post reported that British Columbia-based businessman Peter Roosen, who wants to produce plastic mouldings at the plant, was frustrated that government agencies involved seemed intent on making wallboard there. Roosen’s proposal would involve producing mouldings out of so-called veggie plastic — non-petroleum-based plastic that is primarily a mixture of gypsum and castor oil.

Ouellette said it’s reasonable that a case be made for production of a product that adds value to locally mined gypsum, which currently is exported in its raw form, although there are significant challenges that have been encountered with wallboard, including the distance from markets. He added it’s difficult to wade through the information currently available, given that it involves people with vested interests in the future use of the facility, and the process isn’t even complete.

Roosen’s business plan was reportedly one of five received for the plant. There is speculation that  NSBI is now in talks with Marcel Girouard, who was an owner of Federal Gypsum along with the Simpson family, and who was listed as a director of the company. Girouard operates a related construction industry company in New Brunswick.

Girouard could not be reached for comment Tuesday.

Sarah Levy, spokesperson for NSBI, said the agency remains in discussions with a potential operator but added she couldn’t release any details about the proposal. She also would not confirm or deny that Girouard is involved with that proponent. It will be a couple months before NSBI will be in a position to release more information, she said.