NEWS RELEASE

Tolko signs letter of intent to purchase Slave Lake, Alberta OSB mill from Weyerhaeuser

Vernon, BC - Tolko Industries Ltd. has signed a letter of intent with Weyerhaeuser to purchase their Slave Lake OSB mill located in Slave Lake, Alberta. Slave Lake is located approximately 250 kilometers northeast of Edmonton, Alberta. The Division will form part of Tolko’s engineered wood products group.

Al Thorlakson, Tolko’s President & CEO, said he is pleased with the opportunity to increase Tolko’s investment in Alberta. “The expansion into Slave Lake is a natural extension for Tolko and complements our High Prairie, Alberta and Meadow Lake, Saskatchewan, Oriented Strand Board (OSB) operations. It is an ideal fit with our current sales, marketing and product development goals.”

The OSB mill in Slave Lake has the capacity to produce 240 million square feet (3/8” basis) of OSB annually. The operation currently employs approximately 110 hourly and 30 salaried workers. Contract logging in the winter months employs an additional 100 people. The timber supply for the operation is sourced from the FMU S17, which is part of a Forest Management Agreement that will be transferred from Weyerhaeuser to Tolko as part of the sale process.

Over the course of the next few months Tolko will be evaluating a number of strategic options available to maximize the value of these assets to the Company. While this evaluation is taking place, Tolko will continue to operate the plant as usual.

Tolko is also pleased to announce that they have been successful at the recent fibre auction held in Edmonton, Alberta, securing an additional 247,817 m3 of hardwood tenure. This increased volume will provide Tolko with wood supply flexibility for its two Alberta OSB operations.

Tolko, a BC-based private company, manufactures and markets specialty forest products to world markets. The Company has lumber operations in Lavington, Merritt and Quesnel, British Columbia, High Level, Alberta and The Pas, Manitoba. It also owns a plywood and veneer plant in Heffley Creek, British Columbia, OSB operations in High Prairie, Alberta and Meadow Lake Saskatchewan, and a kraft paper mill in The Pas, Manitoba. The Company will employ over 2400 people with the completion of this transaction.

The closing of the Slave Lake, Alberta transaction is targeted for February 27, 2004 and is subject to customary regulatory approvals.

For more information:

Sheila Catlin
Manager, Communications & Public Relations
Phone: 250-545-4411

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