A panoramic view of Watson Island.

Prince Rupert’s island of dreams and nightmares

In a depressed economy, Chinese government-backed Sun Wave Forest Products purchased the shuttered Skeena-Cellulose mill on Watson Island.

  • Mar. 30, 2013 9:00 a.m.

~ By Quinn Bender

They once were saviours.

In a depressed economy, Chinese government-backed Sun Wave Forest Products purchased the shuttered Skeena-Cellulose pulp mill on Watson Island, vowing to put hundreds of men and women back to work.

In 2006, the City of Prince Rupert approved a multi-million-dollar tax break to help them accomplish this, but something quite different occurred.

Sun Wave stalled on their commitments until all but the most hopeful and fool-hardy rebranded the company a North Coast pariah. Then much of the more profitable equipment was soon unplugged and trucked off.

Many now wonder if it was ever Sun Wave’s intention to re-start the mill.

In 2009, the City seized the property in lieu of unpaid taxes — billed retroactively to when Sun Wave failed to re-open the mill. Meanwhile, its owner, Ni Ritao, later fell under investigation from Chinese authorities for an alleged bank-loan fraud revolving around the site. The head of China’s National Energy Administration and members of the B.C. government have also been singled out in a widening scandal about their connections to Sun Wave.

Whatever the original intention, all that’s known for certain is the burden Sun Wave left in its wake: a rusting and gutted whale, leaching toxins with impunity as it swallows $1.2 million annually from city coffers — at the expense of now-cancelled community programs and municipal projects.

Sun Wave tried suing the City over its seizure of the site, but failed. It could be months before the company files an appeal, and years more before it’s heard in court. The City welcomes Sun Wave to haul off the mill’s assets, which are rightfully theirs, but not before removing the millions of gallons of toxic chemicals, radioactive waste and a staggering tonnage of asbestos. It’s a condition Sun Wave has so far refused to accept, forcing the site, and a new, major economic opportunity, into a near-state of suspended animation.

“The mill looks like everyone went for a coffee break and did not come back,” reads a recent court filing by the City. “However, most movable equipment needed to operate the mill is still missing.”

Neatly arranged on wooden pallets, stacks of spare parts gather dust in the old tin shop.

Auctioneers scavenged the smaller treasures and lined the corridors with pallets like these to present their finds to bidders. It’s unclear whether the auction was organized during or prior to Sun Wave’s ownership, but it never occurred. Today the items just sit as a testament to the permanent closure of what was once the life blood of the region.

As steady streams of water drip into the cold and cavernous workshops, Michael Trim remembers when the site could churn out 1,000 tonnes of northern softwood pulp per day.

“You’d walk through here and it would just be so hot. People were busy in every corner, thinking about how they were going to spend all their money.”

Trim was the site and services superintendent. The City asked him to use his knowledge of the site’s layout and systems to keep the mill from total collapse.

He was just two weeks into his retirement when he accepted the managerial offer.

“My retirement can wait,” he says. “I’m a Rupert boy. I want to see something done with this place, and I’ll watch over it until then.”

Trim passes in silhouette beneath a working light bulb before ascending a stairwell during a site inspection. Near the old cafeteria, he discovers the padlock freshly torn off the door.

It’s the City’s legal responsibility to protect Sun Wave’s assets. Despite the employment of eight full-time security guards, this is the twelfth break-in in three years.

Trim brushes aside the broken lock and enters.

Everything appears in order. The auctioneers’ orderly towers of kitchenware stand under layers of dust on cafeteria tables. Old microwave ovens and toasters take up half the room. The expensive kitchen appliances slipped away years ago under Sun Wave supervision. The thieves were likely searching for stores of canned food that, according to town rumour, are of near-mythical quantity. A fleeting concern creases Trim’s face; after 10 years the term “non-perishable” is a little misleading. Eat at your own risk.

After a brisk inspection of the room, Trim receives a message to call the Ministry of Environment.

“This doesn’t sound good,” he says.

Last November, The Province sent in Haz Mat crews to clean up a large spill containing sulphuric acid. Ever since, the City has been bracing for a $500,000 bill.

Trim fears that bill is on its way. He pockets his phone and descends through the darkness toward his office.

The City hopes to relinquish its financial burden to the Watson Island Development Corporation, or Watco, a consortium of two coal companies and the Lax Kw’alaams and Metlakatla First Nations. They have offered $5 million for the site, in addition to $500,000 to the District of Port Edward for contiguous lands, and will spend between $40 and $70 million in estimated remediation costs.

With no guarantee of a steady fibre supply, Watco will dismantle the mill and take advantage of the rail lines and deep coastal waters for a new bulk shipping terminal and industrial park. They plan to process between 10 and 20-million tonnes of material per year, employing approximately 200 people. The timing of this enterprise is critical. With a history that includes explosives handling and half-century of active pulp production, the site’s contaminates are in a dangerous state of degredation. Watco says it must begin remediating the site within one year, before the financial costs escalate beyond reach. However, the sale cannot take place until Sun Wave’s legal action is resolved in court—yet another expense costing the city $250,000 per year in legal fees.

To keep tabs on the site’s declining state, and to check for signs of intrusion, Dave MacKenzie drives to a dozen locations around the island on a routine security patrol.

In front of a five-storey high-density storage tank, he comes to a stop and points out the protective outer coating crumbling to the earth.

“It’s wild,” says MacKenzie. “The rain gets beneath the bricks and they just peel away.”

Beneath the No. 6 recovery boiler, the truck’s tires drop through deep rivets in the mud track. Overhead, sheets of tin rattle violently in the wind. At the location of November’s sulphuric acid spill, strips of industrial-grade tape still cover the hole in the breached tank. The acid was shipped out for use at a working mine, but heavy rains quickly filled the containment area, making a thorough cleanup impossible. What little acid remained became heavily diluted: too weak for the mines, but too high in ph levels to discharge into the environment.

The site is now saddled with 15,000 gallons of useless waste water.

Nearby, another tank is now causing concern as corrosion eats into its base. If the sodium chlorate solution it contains were to spill and thoroughly dry, any organic material it rested upon would ignite in flame.

MacKenzie resumes his rounds through the mill’s ruin and the dangers contained within it: 1.5-million gallons of black liquor, a caustic by-product of the wood-chip cooking process that, in contact with natural ecosystems, absorbs oxygen and starves all fish and plant life. There are 500 tonnes of pulp; caustic soda in 10- and 50-per-cent concentrations; 23 tonnes of sulphur stored in a damaged and leaking warehouse; 30,000 barrels of C fuel oil; 50,000-cubic metres of hog fuel; PCBs; 38 nuclear devices, used to measure the flow of solids in pipes; and asbestos—lots of it, in the walls and laying in plain view throughout the island.

The infrastructure containing this inventory is degrading daily. For example, some of the earth beneath the power station has washed away, causing worry at BC Hydro that the transformers may topple. Also, the three vessels holding black liquor have not been properly serviced since 2000. Crews try to monitor the integrity of their hulls, but it’s unlikely they’ll catch any warning signs prior to a breach.

Before finishing his rounds, MacKenzie collects a water sample from the No. 1 Lagoon then checks its ph levels back at the office. It will be the last time he does this.

Trim’s phone call with the Ministry of Environment wasn’t what he expected. An LT50 test has proven the ph levels are now low enough to discharge the site’s waste water into Porpoise Harbour. An LT50 test counts the number of fish killed by direct exposure to contaminated water. No fish died, so the water is safe for the ocean.

But this drop of good news merely resolves last year’s sulphuric acid spill. Its favourable outcome doesn’t address any of the other hazards sitting in wait.

“It’s critical to get the site cleaned up,” says Prince Rupert Mayor Jack Mussallem. “That pulp mill was never decommissioned. It was just shut down with the intention that a new owner would be in here within 30 days and get it up and running.”

Following a string of meetings with stakeholders, including the Counsel General of China, Mussallem says the best-case-scenario is to move Watson Island from its expense budget and back on the tax rolls within six months. “Ideally, the City would obtain clear title to the property, that Sun Wave… is able to remove its chattel in a timely manner, that the provincial government and Watco are able to come to terms on a remediation plan so that redevelopment of the property would start.”

Realistically, Mussallem admits that outcome is contingent on a favourable end to Sun Wave’s law suits.

“I believe there is sincerity between the provincial government and Watco, but we’re still waiting on the court cases to proceed, and I have no idea how long that will take.

“I’m finding out more and more about Sun Wave. I understand they had some difficulties with the people that were representing them, but I find it a little strange that the owners didn’t get an overview of what was really happening on Watson Island.”

Repeated attempts by The Northern View to contact Sun Wave were unsuccessful.

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