Pine Falls Paper Mill

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Early Years

General View of Mill 1927, Archives of Manitoba

As early as 1913, interest began to be shown in developing the pulp and paper industry in Manitoba. Once the old growth forests had been harvested, the remaining mixed timber stands of Manitoba were far better suited to pulp production than to lumbering.

In practice, the Provincial Government’s Forestry Branch discouraged such endeavours, reporting that their experience showed forest fires had prevented the timber maturing in the Grand Rapids area, suggesting that there was insufficient timber to support a large pulp mill. This analysis had not changed by 1930. They suggested an alternate location, the White Mud Falls region along the Nelson River. However, in those days this area was considered too remote until after the Hudson Bay Railway was completed. As events unfolded it became clear that the Forestry Branch was incorrect.

Enter a Manitoban Entrepreneur

John Duncan McArthur: Born in Ontario in 1854, McArthur arrived in Winnipeg in 1879. He joined a railroad work-gang and worked his way to become a contractor for the CPR. He built the Manitoba line from Emerson in 1889. In 1905 he contracted to build the Transcontinental Railway line 250 miles east from Winnipeg, then west to Edmonton, Alberta and then on to the Peace River country. By 1910 he had contracted to build, and later to operate, the British Columbia Railway from Edmonton to Grand Prairie. He also built the first 180 miles of the Hudson Bay Railway. In 1920 he secured a permit for the Pine Falls power site on the Winnipeg River. By 1924, with the Canadian National Railway built to Pine Falls, he bought the land to be occupied by the new paper mill and formed the Manitoba Pulp and Paper Company.

Despite the provincial government’s advice, John McArthur, a prominent name in the lumbering trade, concluded that eastern Manitoba’s forests could support a Manitoba-based paper mill. In 1921, he secured several stands of wood (over 729 square miles) in eastern Manitoba. Located on lands lying north of the Winnipeg River, close to the Fort Alexander Indian Reserve. He arranged to lease a square mile of land from the reserve, an area that would be purchased outright in 1927. McArthur negotiated an option to buy more land that adjoined the Reserve. This would become the Pine Falls mill site. Pine Falls was selected because the power potential of the Winnipeg River had been greatly increased in 1923 when the Manitoba Electric Company added the Great Falls power plant to its original plant at Pinawa. Two further generating stations would be built on the Winnipeg river over the years.

Thus was born the Manitoba Pulp and Paper Company. Initial capital investment was $9,000,000. Arrangements were made for the Canadian Northern Railway to build a line from Beaconia on Lake Winnipeg to the new mill site; it opened in 1926. Over the next 80 plus years the company would be an economic boon to the Province.

Pine Falls Town Site is Built

Town of Pine Falls, Gord Goldsborough

In the days before health and safety and any form of Town; Pine Falls was exceptionally well laid out. The company built a company town for 4,000 people. Pine Falls is a good example of positive aspects of community development during this era. Mr. Leonard. E. Schlemm of Montreal was commissioned to lay out the town in conjunction with the Manitoba Pulp and Paper Company engineers. Pine Falls’ layout ensured, though primitive by today’s standards, zoning was used to separate the industrial [which can be seen in the upper area of the photo below] and a residential areas, a system of main and secondary roads, greenbelt areas and a curvilinear street pattern. The photo below is undated, however, in the top right hand corner the logs suggest that it must have been taken before 1965 as that was the last year of the log drive.

Centered on a village green, the town site fanned out in a semi-circular fashion away from the heart of the community. Located at the core were both park space and the commercial zone. To improve the aesthetic value of the central area and provide a common meeting place. The village common included tennis courts, a children’s playground area and bowling facilities all arranged to facilitate community. Opposite the park area and intended to function as a downtown block was the commercial district. Focusing on the community club, the commercial complexion of the downtown area reflected the private-enterprise nature of the community. Consisting of a number of small shops, the commercial area was designed to meet the immediate needs of local residents.

The street pattern echoed the semi-circular nature of the town site plan. The community was serviced by two main arteries from which the “crescents and circles” of residential development evolved. The major road, an extension of PTH 11, the highway to Winnipeg, by-passed the town site. It also defined the other limits of the town site and in some respects helped to discourage peripheral growth. Commenting on the town site layout, a town planner, in the 1920s said the company’s goal was to “adopt the English type of cottage to local conditions and group the various types in pleasing perspective.” He suggested that the paper company incorporated British planning concepts in the styles of dwelling houses and in an attempt to replicate the British village system.

The company provided a community with facilities geared to employee wages. The Manitoba Paper Company selected thirty housing types of standard frame and stucco construction. For the most part, the dwellings were of the five to six room types and ranged in cost from $2,500 for unskilled workmen to $5,500 for the skilled labourer. Additionally two staff houses for unmarried staff and a better accommodation for the company’s superintendents were also provided.

Utility services that were developed for the mill site were co-opted for the community at large. Hence water, sewage disposal, and hydroelectric power facilities all evolved from the industrial plant. Hydroelectric power for example, ran from the mill sub-station directly to the individual housing units. These units in turn were equipped with light, power wiring, electric cooking ranges, and hot water heaters. The company’s benevolence went much further than cooking ranges as some of the more incidental services included lawn mowers, garden hoses and even neighbourhood “service stations” (employees could borrow other household items). However, whether it was garden hoses or electrical lighting, the Company supplied a fairly wide range of services in order to guarantee the availability of a much-needed labour force to operate the mill.

This industrial town concept was a part of the company’s plan for Pine Falls. It borrowed from the Garden City tradition of the rural community in order to provide a pleasant living environment. In doing so, however, the company was the sole municipal authority. In the 1990s the General Manager of the mill doubled as the Mayor of Pine Falls. In many respects Pine Falls was exceptional for its progressive approach to community planning and while it did indeed promote the model town site, it did so on its own initiative where its interests and the workers overlapped. The Mill changed ownership over the course of years and Tembec Industries purchased the mill from the employees in 1998. Tembec did not want to own the town and the town of Pine falls would need to become self-sufficient. Pine Falls decided that it would be in their best interest to join a similar community and went into negotiations with the Village of Powerview. On May 1, 2005 the two communities joined. Pine Falls remains an excellent example of a company town, were the need to attract a stable workforce resulted in a sympathetic community being developed nearly a century ago.

The Paper Mill

General View 1929, Archives of Manitoba
Interior Machinery c.1936, Archives of Manitoba

The Pine Falls mill began production in 1927, one year after the building of the Canadian National Railway line. The mill was an 800-foot long structure, over 100 feet tall. The mill complex consisted of a debarking mill, a cooking mill, a grinding mill, and a mixing mill. In the cooking mill, one-quarter of the pulpwood was digested with steam under pressure, and acid made of limestone and sulphur. In the grinding mill, the other three-quarters of the pulpwood were reduced to pulp without the use of chemicals. In the mixing mill the pulp was purified, dried and became 1500 lb. rolls. These were then loaded directly into railway cars. The photo below is from 1927.

Spanish River Pulp and Paper Company of Ontario bought the Manitoba Pulp and Paper Company in 1927. Then in 1928, the Abitibi Paper Company acquired all of Spanish River’s mills. The Abitibi Paper Company formed in 1913 with its first mill at Abitibi River at Iroquois Falls. In 1927, it began purchasing other mills in Ontario and Quebec, as well as the Manitoba Paper Company at Pine Falls. Abitibi’s timing was wrong because in 1928 a fall in the price of paper from $80 to $68 a ton precipitated a crisis. By 1932, the price had fallen to $48 per ton and all of Abitibi’s mills were only working at 28% of their capacity. As a result Abitibi went into receivership in 1932, in what would become the longest and largest receivership suit in Canadian history, lasting 14 years.

In the mill at Pine Falls, production in 1928 had reached 258 tons of paper per day. Despite the rail connection in 1928 and 1929, Abitibi used barges to ship 100 tons of paper down Lake Winnipeg directly to the Winnipeg Free Press. A road was created from Pine Falls to Great Falls in 1930 and to Lac Du Bonnet in 1931.

The Depression and WWII

The mill was closed in February 1932, but the company tried to keep its workers in the community by charging reduced rents for the company houses. In July 1935, the company put one paper machine back into production and then the second machine, in the fall of 1935.

Full recovery did not occur till WWII, which brought an explosion of demand for Canada’s forest resources, including paper, and Pine Falls again was booming. Between 1944-46, German prisoners of war were used to work in the lumber camps all over the Province. Mill production was up to 345 tons of paper per day by 1948, and 403.9 tons per day by 1955.

Post-WWII Period

General View c.1958, Archives of Manitoba

After WWII operations at the mill changed. May 1965 saw the last log drive on the Winnipeg River. These log drives, held annually for 25 years, were often 31 miles long, taking 10 days to complete and requiring the help of waters stored on Cat Lake and Bear Lake to push the logs down the Bear River to the Pine Falls Mill. Cutting had progressed well past the river systems and ice roads were now more economical for transporting winter stockpiles of logs via tractor trains and trucks to the mill.

Wood harvesting was expanded. Railcar loads of wood chips began arriving from Hudson Bay Junction in Saskatchewan. Loads of cordwood were shipped from other places in Manitoba as improved roads opened the forests of northern Manitoba. Its timber supply came from a large area on the east side of Lake Winnipeg, over halfway up the lake, and also in the Interlake on the west side of the lake. By 1979 the daily capacity of the Pine Falls mill was 500 tons of finished newsprint. To feed this the company required a secure hardwood supply of 122,000 c. units of spruce and /or balsam fir and 3000 c. units of jack pine. In 1979 the Provincial Government entered into a five-year agreement with the company to undertake intensive forest management responsibilities.

By 1976, the mill, at that time the only newspaper-making facility on the prairies, was producing enough newsprint for a million 48-page newspapers. It consumed 3.75 billion gallons of water a year and 265,000 megawatt-hours of electricity (about 42% of the nearby hydro dam’s total output).

Newsprint was Abitibi-Price’s most important product, with 85% of its production in mills in Eastern Canada. 90% of Canada’s newsprint production was exported to the United States. This number began to drop as the American newsprint industry emerged, with a cost advantage of 15%. By 1994, Abitibi decided that the Pine Falls complex was no longer financially worthwhile, and announced that the mill would be closed. According to Abitibi’s Forest Management Plan with the Provincial Government, it was required to give two years notice of its plans to close the plant. This time period was sufficient for the employees of the plant to form a company to purchase the operation, renaming it the Pine Falls Paper Company. As such, the mill continued to be productive. In late 1998 a Quebec-based company, Tembec acquired it. They paid the employee owners $100M.

Tembec and the Final Closure of the Mill

New TMP Being Dismantled 2012, Diane Dube

As environmental regulations tightened in the late 20th century, it became increasingly difficult for a mill designed in 1926 to continue to be compliant with its discharges into the air, soil and adjacent river. To this end Tembec invested $125M between 1999 and 2001. Tembec built an industry-standard thermo-mechanical pulping (TMP) mill. This technology replaced two older pulping technologies: stone ground wood pulping and sulphite pulping. Closure of the old sulphite mill had an immediate positive effect: no more rotten-eggs smell in town. The new TMP mill gave off a more pleasant smell of wood shavings and produced so much waste heat that a heat recovery unit reduced the mill’s requirements for coal. Consequently, greenhouse gas emissions decreased by about 50%.

The paper mill closed in September 2009 due to the declining demand for newsprint, just a few years after its new TMP mill became fully operational, and demolition began in 2011. By the spring of 2014, the once-dominant paper mill was gone.

Manitoba Economic Benefits of the Mill

The presence of a pulp mill in Manitoba at Pine Falls created winter employment for thousands of Manitobans. Pulpwood was cut all over Manitoba and shipped to the Pine Falls plant. In The Pas area, independent lumbering companies sold their pulp to Pine Falls until 1967, when the Churchill Forest Industries plant opened in the region. To settlers on marginal land, the pulp industry offered an opportunity to supplement their meagre earnings from their farms. In the 1930s, a good pulpwood cutter, using an axe and a narrow blade Swede saw, could cut two and one-half cords per day, as well as pile the brush from the trees for burning. His pay was $2.25 per cord and he was charged $1.00 for his board in the camp. Many farmers enabled themselves to buy the seed for spring planting by working through the winter.


In the 90 years of its existence the Pine Falls mill was a great boon to the economy of Manitoba, like all resource based industry towns it suffered with the impact of the economy on the need for its products. However, John Duncan McArthur deserves credit for ignoring the advice of the Provincial Forestry department in the 1920s and forging ahead with a paper mill.