<b>Eastern Pulp &amp; Paper Reviewing Claim</b>

Eastern Pulp & Paper is reviewing the Notice of Claim filed by the U.S. government in connection with the past discharge of dioxin into Maine's Penobscot River.

U.S. officials recently told Eastern executives that the government to date has not identified any significant or immediate risks from the Lincoln, Maine, mill. Eastern executives also said U.S. officials told them that the government doesn't know the extent of possible claims--and that the government was not prepared to make any specific factual allegations against the company.

Eastern said government lawyers filed the Notice of Claim to meet a procedural deadline established by the U.S. Bankruptcy Court for filing claims, after which any potential claim may be barred. The Notice of Claim is not a lawsuit, but rather a legal filing to preserve the government's place for a possible claim.

U.S. officials have told Eastern that the government is still conducting an environmental study of the Penobscot River--and that it will continue to do so for some time. U.S. officials have also told Eastern that they have not made any decisions on what cleanup, if any, may be required.

The Notice of Claim said that the government believes there could be a very wide range of future costs and damages and set the range at between $400,000 and $60 million. "The wide cost range underscores the speculative nature of this matter," said George Marcus, an attorney representing Eastern Pulp & Paper Corp.

Eastern Pulp & Paper has conducted several studies of its Lincoln, Maine, facility over the past 10 years and is aware of data gathered by the State of Maine and the U.S. Environmental Protection Agency at the mill and on the Penobscot River. All of that data shows there are no health or environmental risks of significance from the Lincoln facility.