Domtar to increase energy self-sufficiency from renewable sources at its
Dryden pulp mill

    
    TICKER SYMBOL
    UFS (NYSE, TSX)
    

DRYDEN, ON, May 22 /CNW Telbec/ - Domtar Corporation (NYSE/TSX: UFS) today announced that it will proceed with a project at its Dryden, Ontario pulp mill to improve electricity self-sufficiency with the installation of a new turbine. The capital investment of CDN$22.7 million will be entirely funded by credits received under the Government of Canada's Pulp and Paper Green Transformation Program.

"We are grateful to Natural Resources Canada for their support under this program," said Jim Blight, Dryden Mill Manager. "As we prepare the groundwork for this important mill upgrade and celebrate this announcement, we also recognize our people's efforts to improve our safety performance and cost structure."

With detailed design work and procurement activities underway, work related to the installation of the new turbine and associated equipment will take place in 2011.

"As the largest recipients of funding under the program, we thank the Government of Canada for investing in our industry. We are excited to move forward with important upgrades to our eligible Canadian operations with both environmental and economic benefits for the communities in which we operate, as is the case in Dryden here today," said John D. Williams, President and Chief Executive Officer of Domtar Corporation.

Domtar was allocated a total of CDN$143 million dollars for investments aimed at improving energy efficiency and environmental performance under the Pulp and Paper Green Transformation Program. It owns and operates a total of four pulp and paper mills in Canada, all eligible for this program.

    
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About Domtar

Domtar Corporation (NYSE/TSX:UFS) is the largest integrated manufacturer and marketer of uncoated freesheet paper in North America and the second largest in the world based on production capacity, and is also a manufacturer of papergrade, fluff and specialty pulp. The Company designs, manufactures, markets and distributes a wide range of business, commercial printing and publishing as well as converting and specialty papers including recognized brands such as Cougar(R), Lynx(R) Opaque Ultra, Husky(R) Opaque Offset, First Choice(R) and Domtar EarthChoice(R) Office Paper, part of a family of environmentally and socially responsible papers. Domtar owns and operates Domtar Distribution Group, an extensive network of strategically located paper distribution facilities. Domtar also produces lumber and other specialty and industrial wood products. The Company employs over 10,000 people. To learn more, visit www.domtar.com.

Forward-Looking Statements

All statements in this press release that are not based on historical fact are "forward-looking statements." While management has based any forward-looking statements contained herein on its current expectations, the information on which such expectations were based may change. These forward-looking statements rely on a number of assumptions concerning future events and are subject to a number of risks, uncertainties, and other factors, many of which are outside of our control that could cause actual results to materially differ from such statements. Such risks, uncertainties, and other factors include, but are not necessarily limited to, those set forth under the captions "Forward-Looking Statements" and "Risk Factors" of the latest Form 10-K filed with the SEC as periodically updated by subsequently filed Form 10-Q's. Unless specifically required by law, we assume no obligation to update or revise these forward-looking statements to reflect new events or circumstances.

SOURCE Domtar Corporation

For further information: For further information: Media and Investor Relations: Pascal Bossé, Vice-President, Corporate Communications and Investor Relations, (514) 848-5938; Information: Bonny Skene, Manager, Regional Public Affairs, (807) 223-9035

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Domtar Corporation

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