1,000

1,500

20311996 1957

2074

2,500

2084

2241

1521

2,000

2019SUSTAINABILITYREPORTPORT HAWKESBURY PAPER

MIKE HARTERYCO-MILL MANAGER

BEVAN LOCKCO-MILL MANAGER

Port Hawkesbury Paper (PHP) is the largest industrial employer in Cape Breton and is an integral business partner to the region and the province. With a focus on safety, economic, environmental and social values, the company is always adapting to the ever-changing challenges.

Our Woodlands Unit is dedicated to sustainable forest management through continual improvement of resource inventories, operational planning, habitat mapping and other forestry objectives. Through outside analysis and third-party independent auditing, we manage over sixty different values identified for management or protection. The company will continue to drive refinement and innovation in our forestry management to balance environmental, social, and economic interests.

While the paper market continues to see capacity changes and adjustments to right-size supply and demand, the company has adapted through cost management and ingenuity by employees to improve efficiencies. We are continually working to improve how we manage our current business, while looking at opportunities and envisioning how to make the company sustainable into the future. We have encouraged business growth in the region by opening our site to the development of new business opportunities.

2020 brings unprecedented challenges in both the paper industry, forestry and businesses in general. We have positioned the company to adjust and continually improve through innovative technology and highly skilled employees and we are well-positioned to adapt as the company moves forward to tomorrow.

EMBRACING INGENUITY AND OVERCOMING CHALLENGES

PHP licensed land identified and managed as High

Conservation Value Forest

The managed Crown land set aside as protected area or left untouched

Areas regenerated with new forests – either through natural

regeneration or planting

48%

HEALTHY FORESTS HEALTHY COMMUNITIES

WE ARE ALL INTERCONNECTED

The wood used for paper production comes mainly from the seven eastern counties of Nova Scotia from Crown managed land and private woodland

owners. The employees and contractors of Port Hawkesbury Paper not only work in the managed regions, but live, play, hunt and fish there as well. All

company employees and contractors have a vested interest in the long-term sustainability of the forests.

WATER CONSUMPTIONCUBIC METER PER METRIC TONNE OF PAPER PRODUCED

5.0

15.0

10.0

25.0

20.0

21.24

17.33 17.03

22.10

19.28

17.67

2013 2014 2015 2016 20182017 2019

15.44

In 2019 and into 2020, the mill managed through significant changes in the paper industry. Capacity corrections, market demand reductions and power management all necessitated unplanned curtailment for the company. While the employees have effectively managed the fluctuations in production, it has impacted how we measure key environmental indicators. Environment Canada Regulations provide an approved method for calculating a Reference Production Rate (RPR), which is the highest 90th percentile of the previous three years’ actual production rate. This calculation normalizes production for events of curtailment, such as we had in 2019. RPR is how we report our compliance data to Environment Canada for other areas of the mill and, with the exception of electricity consumption, we have converted our annual measurements to reflect this change.

ADAPTING TO NEW AND CHANGING MARKETS

TSS TO EFFLUENT TREATMENTKG PER METRIC TONNE OF PAPER PRODUCED

20.0

25.0

10.0

30.0

15.0

5.0

2013 2014 2015 2016 20182017 2019

28.526.9

18.7

26.527.6

21.9

19.6

SOLID WASTE GENERATEDKG PER METRIC TONNE OF PAPER PRODUCED

150.0

200.0

50.0

250.0

100.0

300.0

Solid Waste wet kg/tonneSolid Waste dry kg/tonne

2013 2014 2015 2016 20182017 2019

189.1

238.349.2

PHP WOODLANDS UNIT VISION STATEMENT:

That the forest resources, for which we have a responsibility, will sustain healthy ecosystems and natural biodiversity, provide a continuous and expanding supply of valuable wood and conserve the forest characteristics of value to society, wildlife and the environment.

2.5 MILLION THE APPROXIMATE NUMBER OF

NATIVE TREE SEEDLINGS THE MILL PLANTS ANNUALLY

194.5

45.2

149.3 146.1

190.944.8

148.3

192.4

44.1

139.5

183.2

43.7

135.1

182.447.3

35.6

111.5

147.1

NET STEAM CONSUMPTIONGIGAJOULES PER METRIC TONNE OF PAPER PRODUCED

AIR QUALITY/GHG EMISSIONSKG OF C02 EQ PER METRIC TONNE OF PAPER PRODUCED

2013 2014 2015 2016 2017 2018

5.00

6.00

3.00

4.00

InternalPurchased

2.00

1.00

2019

2.7

2.7

5.9

5.2

4.7 4.9

5.4

4.9

2.0

3.2

2.0 2.01.7

2.1

2.6

3.2

2.9 3.2

3.3

1.8

4.4

500

1,000

1,500

2015

2031

2016

1996

2017

1957

2018

2074

2,500

2014

2084

2013

2241

2019

1521

2,000

IT IS NOT JUST ABOUT MAKING PAPERIT IS ENVISIONING OUR TOMORROW

ELECTRICITY CONSUMPTIONKWH PER METRIC TONNE OF PAPER PRODUCED

1,000

2,000

2,500

3,000

2015 2016 2017 201820142013 2019

3,186 3,178 3,235 3,2803,2873,282 3,269

1,500

500

Port Hawkesbury Paper has entered into an innovative and completely new 4-year agreement with Nova Scotia Power (NSPI). The agreement provides our business the opportunity to

remain viable while providing the utility with the ability to maximize the value of PHP’s large flexible electrical load to the benefit of all NSPI’s customers. Under this new rate, PHP

has essentially “turned over the keys” of its operations to NSPI from an electricity supply perspective, providing them with the ability to dictate the timing and magnitude of PHP’s

electricity usage within agreed to monthly electrical needs. While the control over the daily power supply can impact production efficiency, the mill has adjusted operations to maintain

very acceptable levels of overall productivity. Both NSPI customers and Port Hawkesbury Paper will realize total cost savings and environmental benefits by improving the integration

of intermittent renewable generation sources such as wind and solar.

NEW WAYS TO MANAGE ENERGY USE

PORT HAWKESBURY PAPER IS COMMITTED TO ONGOING ENERGY CONSERVATION AND REDUCTION

Steam from Natural Gas

Steam from HRU’s

STEAM FROM NATURAL GAS, BIOMASS AND FROM HEAT RECOVERY UNITS (HRU)

STEAM GENERATION

FUEL MIX

3,500

Steamfrom Biomass

PORT HAWKESBURY PAPER120 Pulp Mill Road Port Hawkesbury, Nova Scotia | B9A 1A1 1.800.989.3608 | www.porthawkesburypaper.com

ABOUT PORT HAWKESBURY PAPERAt Port Hawkesbury Paper, we are the leader in supercalendered paper manufacturing in North America. We believe that every employee’s actions make a difference, and we rely on committed, skilled people to use leading-edge processes and technology to develop best-in-class products. The secret to our effectiveness is shown in the consistent and reliable quality of our products and our open communication and problem-solving with our employees, suppliers, and customers. Quality, reliability, and consistency of products and services deliver ultimate customer value.

Port Hawkesbury Paper ships its products to customers throughout North America and around the world. The mill produces the Artisan® Plus and Artisan® (SCA++), Prominence® Plus (SCA+), Prominence® (SCA) and Maritime® (SCB) brands for use in retail inserts, catalogs, magazines, circulars, coupons and specialty packaging applications. Port Hawkesbury Paper is the only industrial company in the Maritimes that is independently certified by the Forest Stewardship Council® (FSC®) forest management (FSC-C023189) and chain of custody standards (FSC-C112699), Sustainable Forestry Initiative® (SFI®) forest management and chain of custody standards, and PEFC™ chain of custody standard.

©2020 Port Hawkesbury Paper LP.

SFI-01564