KENORA, Ont. — After saying its Kenora operations were in no immediate danger, Abitibi-Consolidated has cut 147 jobs and another 333 of the remaining 390 employees will be out of work until fall.

The company plans to permanently shut down one newsprint machine — paper machine No. 8 — at the Kenora mill, while the mill’s two remaining machines will be stopped indefinitely. The move was prompted by market conditions and high energy costs, company officials tell local media.

“This is purely a business decision, it is regrettable but we had to take action,” says Abitibi’s senior vice-president for Northern Newsprint Operations, Denis Jean. “Due to its production costs, which are among the highest in Abitibi Consolidated … the Kenora mill could not compete any longer from a cost perspective in a mature market that suffers from an excess in production capacity.”

The shutdown of paper machine No. 8 combined with the planned conversion of machine No. 9 to value-added paper will reduce the company’s newsprint capacity by 180,000 tonnes annually.