Marathon Pulp mill sale delayed: MOE won't approve brownfield property sale.

• Author: Ross, Ian

The potential American buyers of the former Marathon Pulp mill have missed a critical deadline to close the sale of the contaminated property from Tembec.

A final Jan. 22 deadline, imposed by the Ministry of Environment (MOE), to complete the transaction and transfer of the industrial land to Green Investment Group Inc. (GIGI) has come and gone.

Ministry spokeswoman Lisa Brygidyr said GIG', an Illinois-based brownfield redeveloper, was unable to commit to fulfilling the necessary environmental requirements to clean up the mill property for the long term.

"The conditions of the sale agreement were not met."

Brygidyr said all the parties signed off on a sale agreement last year and a final closure date this month after repeated extensions were granted by the ministry.

That doesn't mean the sale of the property won't proceed, she said, but Tem-bec and GIGI will have to come back to the ministry with a new sale agreement with terms and conditions requiring MOE approval.

How long that process will take to work through is unknown.

Because the property on the northeast shore of Lake Superior was heavily contaminated, the MOE had final say on its transfer to any potential new owner who had the means and track record to carry out the cleanup work.

Ministry oversight was a condition outlined in a 2011 settlement agreement between the province and Tembec, the mill's former owner, which operated the mill until bankruptcy forced its closure in 2009.

Brygidyr would not comment on the details of the business arrangement, but said certain financial requirements needed to be in place in order for the ministry's approval of the sale.

Both companies agreed to set aside a combined $6.8 million as financial assurance for the cleanup; $4.8 million from Tembec and $2 million from GIGI.

Brygidyr said Tembec has posted its money, but GIGI has not as of early February.

Established in 2005, GIGI has acquired other brownfield properties across North America, including some former Smurfit-Stone paper mills in New Brunswick and Quebec.

The company portrays itself as performing environmental site cleanups on vacated and heavily contaminated industrial properties, then marketing to and attracting small companies engaged in green business manufacturing.

GIGI president Ray Stillwell did not respond to requests for an interview, but Gerry Philippe, his vice-president of Canadian operations, responded by email that the company remains in play.

"Green Investment Group...