Bowater Comments on Third Quarter 2005 and Announces Cost Reduction Program

    Bowater Inc.

Bowater Incorporated (NYSE: BOW) today announced that it expects third quarter
operating income, excluding a gain of approximately $9 million on the sale of
assets, to be in the range of $35 to $40 million. Higher transaction prices for
the company's paper products were offset by higher manufacturing and
distribution costs, related to Hurricane Katrina, a stronger Canadian dollar and
higher maintenance expenses. Prices of pulp and lumber in the third quarter were
also lower than the second quarter.

The company also announced today a program which is expected to reduce annual
operating costs by $80 million. This program will be fully implemented by the
end of 2006 and driven by operating and distribution cost savings.

"The sharp rise in the Canadian dollar and energy prices requires us to be even
more aggressive at reducing costs," said Arnold M. Nemirow, Chairman, President
and Chief Executive Officer. "We have been very successful in implementing
significant cost reduction programs in the past, and I expect we will execute
this program in the same manner."

All amounts are in U.S. dollars.

Bowater will release third quarter financial results before the market opens on
Wednesday, October 26, 2005. A management conference call will be held to
discuss these financial results at 10:00 a.m. EDT, October 26, 2005. The
conference call number is 800-288-8967 or 612-234-9960 (international). The call
will also be broadcast via the Internet. Interested parties may connect to the
Bowater website at www.bowater.com, then follow the on-screen instructions for
access to the call and related information. A replay of the call will be
available from 1:30 p.m. EDT on Wednesday, October 26, through Wednesday,
November 2, on the website or by dialing 800-475-6701 or 320-365-3844
(international) and using the access code 798866.

Bowater Incorporated, headquartered in Greenville, SC, is a leading producer of
newsprint and coated mechanical papers. In addition, the company makes uncoated
mechanical papers, bleached kraft pulp and lumber products. The company has 12
pulp and paper mills in the United States, Canada and South Korea and 12 North
American sawmills that produce softwood lumber. Bowater also operates two
facilities that convert a mechanical base sheet to coated products. Bowater's
operations are supported by approximately 1.4 million acres of timberlands owned
or leased in the United States and Canada and 30 million acres of timber cutting
rights in Canada. Bowater is one of the world's largest consumers of recycled
newspapers and magazines. Bowater common stock is listed on the New York Stock
Exchange, the Pacific Exchange and the London Stock Exchange. A special class of
stock exchangeable into Bowater common stock is listed on the Toronto Stock
Exchange (TSX: BWX).

Operating income, in accordance with U.S. generally accepted accounting
principles, is expected to be in the range of $44 to $49 million, including a
gain of approximately $9 million on the sale of assets.

Statements in this news release that are not reported financial results or other
historical information are "forward-looking statements" within the meaning of
the Private Securities Litigation Reform Act of 1995. They include, for example,
statements about our business outlook, assessment of market conditions,
strategies, future plans, future sales, prices for our major products, inventory
levels, capital spending and tax rates. These forward-looking statements are not
guarantees of future performance. They are based on management's expectations
that involve a number of business risks and uncertainties, any of which could
cause actual results to differ materially from those expressed in or implied by
the forward-looking statements. The risks and uncertainties relating to the
forward-looking statements in this news release include those described under
the caption "Cautionary Statement Regarding Forward-Looking Information" in
Bowater's annual report on Form 10-K for the year ended December 31, 2004, and
from time to time, in Bowater's other filings with the Securities and Exchange
Commission.



    CONTACT: Bowater Incorporated
             Media Contact:
             Gordon R. Manuel, 864-282-9448
             or
             Analyst Contact:
             Duane A. Owens, 864-282-9488
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