Terrace Bay - History

History

Terrace Bay originated as a company town in the 1940s when a pulp and paper mill was established there by the Longlac Pulp & Paper Company, later renamed Kimberly-Clark Forest Products. At the same time, the Aguasabon Generating Station was created by the Ontario Hydro water division, to redirect the northward flowing Long Lake south through the Aguasabon River system to Lake Superior. The Long Lake and Ogoki diversions which combine to end at Terrace Bay are the most significant water diversion into the Great Lakes and after it was opened, it boosted Lake Superior water levels by 2.4 inches (61 mm), Lake Michigan and Lake Huron by 4.3 inches (110 mm), Lake Erie by 3.1 inches (79 mm), and Lake Ontario by 2.8 inches (71 mm).

On September 1, 1947, Terrace Bay was granted status as an Improvement District. The pulp mill was the lead developer with construction of the community's basic infrastructure. By the end of 1948, Terrace Bay consisted of about 230 houses serviced with sewer, water and electricity but surrounded only by bush as the highway was still not completed through the town. In 1951, the Lakeview subdivision was started, with sewer, water and electrical services provided for well over 100 houses. By December 31, 33 of the 35 new houses were completed and occupied. Other additions to the community were two new churches, 22 bed modern hospital, post office, bank, liquor store, theatre, clothing store and railway station. Construction of the Memorial Recreation Centre was completed in July 1953. The building consisted of an arena, curling club, restaurant, bowling alley, library, offices, 3 meeting rooms and public washrooms. In 1958, the mill converted to chlorine-dioxide bleaching and had sold 63 houses to employees and another 28 houses were privately built. The next year, Terrace Bay became a municipal township.

In 1972, the Kimberly Clark Pulp and Paper Company Ltd. and Kimberly Clark of Canada Ltd. amalgamated. From 1972 to 1977 the population of Terrace Bay increased from 1,755 to 2,299 persons, directly attributed to Kimberly Clark's expansion program. The pulp mill was the lifeblood of the region and in 2005 Kimberly-Clark sold the mill to Neenah Paper Inc who then sold the mill to Buchanan Forestry Products in 2006 and the mill was renamed to Terrace Bay Pulp Inc. The mill operated until it ran into financial hardship and was shut down in 2009. After financial reorganization, it reopened in October 2010 to strong pulp markets.

Terrace Bay Pulp completed its annual major shutdown just prior to the explosion of a blow tank on October 31, 2011, that resulted in the death of an employee. The unexpected shutdown that occurred as a result of the explosion happened at a time when the mill was vulnerable to additional expenses and a lack of production due to the annual shutdown. This resulted in a major liquidity crisis at a time when pulp prices were declining, and the company decided to idle the mill for three months. It did not restart operations and was put up for sale. In July 2012 a deal was announced with the Aditya Birla Group where they agreed to purchase the mill and invest $250 million into the operation to convert it to produce a dissolving pulp. The Aditya Birla Group through this investment created the new company AV Terrace Bay Inc. for the operation of the pulp mill. The Aditya Birla Group is a $40 billion company and their investment is viewed as a huge boom for the Community and an end to the previous up and down nature of the pulp mill.

The Municipality carried out an ambitious plan for growth in 2010/2011 including the downtown revitalization plan, the cultural centre project, and a total rebranding of the Township based on Lake Superior and the new Terrace Bay Lighthouse attraction that was built and Lake Superior. This plan resulted in renewed interest in the Community, job growth, and Terrace Bay being recognized as the Northern Ontario Entrepreneurial Community of the Year 2010/2011 by the Northern Ontario Business Awards.