AGRI-FOOD EQUITY FUND INVESTS IN DURAFIBRE INC.

Released on December 22, 1997

Agriculture and Food Minister Eric Upshall today announced the

Agri-Food Equity Fund will invest $775,000 into shares of Durafibre

Inc., a company located in Canora which produces a fibre from oilseed

flax straw and processes it for a number of uses.



Durafibre was formed in 1993 by Cargill Limited and Sask-Can Fibre,

Inc., a farmer-owned straw procurement co-operative. It was borne out

of the desire by local farmers to find a market for their unused flax

straw. The investment from the Agri-Food Equity Fund will be used to

complete Durafibre's production facilities, located five kilometres

southeast of Canora.



"Saskatchewan is Canada's largest producer of oilseed flax and

although some flax straw is exported, most is burned," Upshall said.

"Durafibre has not only found a commercial use for this straw, they

are also helping to boost the province's value-added sector."



Durafibre has developed innovative technologies with which to process

oilseed flax straw. The resulting fibre may be used for paper

products, geotextiles and as a synthetic fibre replacement in

automobile components. Through Cargill Limited, Durafibre's major

shareholder, the company's products will be marketed to a wide range

of industrial companies.



Michael Yaholnitsky, President of Durafibre, says there has been

a lot of interest in Durafibre's product, which is not limited to

flax fibre. "We also process the remaining shive material which

can be used in composite board materials and recycled paper

products," Yaholnitsky said. "By developing new markets for the

fibre and shive, we effectively reduce farmer's costs and

increase interest in an often overlooked crop."



"In time, Durafibre will create up to 30 new jobs in the Canora

area," Upshall said. "The Agri-Food Equity Fund is helping to

ensure a thriving business environment for rural Saskatchewan by

investing in this ground-breaking company."



Durafibre is the 14th investment made by the Agri-Food Equity

Fund since its establishment in 1994. The Government of

Saskatchewan committed $20 million over a period of five years

for the expansion of the value-added sector of the agriculture

and food industry. About $15 million remains to be invested.

Each investment carries a maximum eight year term. Revenues

generated from investments are returned to the fund for

reinvestment in further value-added opportunities.



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For more information, contact:



Lyle Bolen Michael Yaholnitsky

Agri-Food Equity Fund President, Durafibre

Saskatoon Canora

Phone: (306)933-7682 Phone: (306)563-6601