NOVA SCOTIA (From news reports) -- British Columbia's Supreme Court has ordered the Government of Nova Scotia to enter mediation with Northern Pulp over the company's $450-million lawsuit.

The order demands closed-door negotiations between the province and Northern Pulp over the former's alleged liability for forcing the closure of the Boat Harbour effluent treatment facility a decade before the expiry of the company's lease to the provincially owned facility.

It also puts on hold Northern Pulp's lawsuit against the province.

In that suit, the company alleges provincial government bureaucrats conspired to force it to voluntarily close the Abercrombie Point kraft pulp mill so the province would avoid its legal obligations to Northern Pulp and the Pictou Landing First Nation.

The suit further alleges there was a choreographed approach between provincial government departments via a committee of deputy ministers reporting to the executive council to first misrepresent data to set unachievable targets (well beyond those set by national pulp and paper effluent standards) for the mill's industrial approval to operate as far back as 2014, then set a timeline for completing a replacement effluent treatment facility the government's own consultant said was unachievable.

The province denied having a liability to Northern Pulp in its arguments against the mediation order.

In court documents, provincial government lawyers also said:

• That mediation shouldn't be ordered before the province files a response to Northern Pulp's lawsuit (which was filed last November).
• That the amount of alleged liability by the province to the company would be affected by the result of the current environmental assessment process over its replacement effluent treatment facility, which won't be complete for at least two more years.
• That ordering an unwilling party (itself) into mediation is unlikely to achieve a good result.

The mediator will be Thomas Cromwell, a retired Canadian Supreme Court and former Nova Scotia Court of Appeal justice.

Northern Pulp estimates its share of the cost of the mediation would come in at just under $1 million, which it purports to have access to.

All discussions held as part of the mediation will be confidential. Any agreement will only become binding if it's agreed to by all parties.

The door was left open in the agreement that the Pictou Landing First Nation could also be ordered to participate if it was determined necessary by the mediator.