Catalyst Snowflake Mill given notice of corrugating machine shut

    RICHMOND, BC, June 26 /CNW/ - Catalyst Paper Corporation (TSX:CTL) has
been advised by Smurfit-Stone Container Enterprises Inc. that it will cease
operation of the corrugating medium machine at the Snowflake Mill no later
than October 15, 2008.
    Snowflake Mill has operated the Smurfit-Stone machine under a 10-year
contract. Closure of the machine will result in elimination of approximately
100 salaried and hourly positions at the mill.
    Under the contract, severance and related one-time costs will be borne by
Smurfit-Stone. Termination of this contract was anticipated in Catalyst's
acquisition of Snowflake Mill and is expected to have no impact on the
projected annual synergies of $10 million announced at the time of that
    The Snowflake Mill is located about 290 km (180 miles) from Phoenix,
Arizona and is one of the lowest-cost newsprint mills in North America. With
annual production capacity of 375,000 tonnes of 100 per cent recycled
newsprint, Snowflake brings Catalyst's total newsprint production capacity to
approximately 980,000 tonnes, complementing its mechanical specialty paper
capacity of some 1.1 million tonnes.
    Catalyst is a leading producer of mechanical printing papers,
headquartered in Richmond, British Columbia, Canada. The company also produces
market kraft pulp and owns Western Canada's largest paper recycling facility.
With six mills strategically located within western North America, Catalyst
has a combined annual capacity of 2.8 million tonnes of product. Catalyst's
common shares trade on the Toronto Stock Exchange under the symbol CTL.

    Forward-Looking Statements

    Certain matters set forth in this news release including statements with
respect to production capacity, the achievement of synergies, cost reductions
and business efficiencies which may result from the acquisition of the
Snowflake mill are forward-looking statements. These forward-looking
statements reflect management's current views and are based on certain
assumptions including assumptions as to future economic conditions and courses
of action, as well as other factors management believes are appropriate. Such
forward-looking statements are subject to risks and uncertainties that may
cause actual results to differ materially from those contained in these
statements including those risks and uncertainties identified under the
heading "Risk Factors" in the management's discussion and analysis contained
in Catalyst's first quarter 2008 interim report available at

    %SEDAR: 00000638E

For further information:

For further information: Lyn Brown, Vice-President, Corporate Relations,
(604) 247-4713

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Catalyst Paper Corporation

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