VANCOUVER -- Fortress Paper Ltd. reports that it has experienced a burst in a pressurized auxiliary gas collection system relating to one of the recovery boilers at the Fortress Specialty Cellulose Mill (the "FSC Mill") in Thurso, Québec. Health and safety protocols were immediately implemented and applicable government authorities were notified.

There were no injuries and no material damage to property or environmental impact. The Company is in the process of determining the cause of the failure and assessing the operational impact on the FSC Mill. The cogeneration facility continues to operate at a reduced rate and the Company is reviewing the timing for re-starting the mill. The Company carries customary property damage and business interruption insurance with a $2.5 million deductible. There is no assurance of the outcome of an insurance claim or if the losses caused by the failure will exceed the deductible. The Company will provide further updates once such assessments are completed.

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