<PAGE>


                    LONG TERM INCENTIVE PLAN OPTION AGREEMENT

THIS AGREEMENT is made as of September 12, 2001

BETWEEN:

                  NORSKE SKOG CANADA LIMITED, a body corporate amalgamated under
                  the laws of Canada, having an office at 900 - 700 West Georgia
                  Street, Vancouver, British Columbia, V7Y 1J7

                  (the "CORPORATION")

                                                              OF THE FIRST PART,

AND:

                  [NAME OF EXECUTIVE], of [ADDRESS]

                  (the "OPTIONEE")

                                                             OF THE SECOND PART.

WHEREAS:

A.   The Optionee is an Employee or a Director; and

B.   The Corporation wishes to grant to the Optionee an option to purchase
     Shares on the terms and conditions set out in the Norske Skog Canada
     Limited 1995 Stock Option Plan (the "Plan") approved by the Human Resources
     Committee of the Board of Directors of the Corporation on July 25, 1995 and
     as amended from time to time.

NOW THEREFORE the parties hereto agree as follows:

1.   INTERPRETATION

     (a)  The masculine gender shall include the feminine gender and the
          singular shall include the plural and vice versa.

     (b)  A reference to a section includes all subsections in that section.

     (c)  Capitalized terms not otherwise defined herein shall have the meanings
          ascribed to them in the Plan.


<PAGE>


2.   GRANT OF OPTION; OPTION PRICE

     The Corporation hereby grants to the Optionee, subject to the terms and
     conditions hereinafter set out, the irrevocable right and option to
     subscribe for and purchase (the "Option") a total of o Shares (the
     "Optioned Shares"), as fully paid, at an Option Price of $6.60 per Optioned
     Share for a term commencing on September 12, 2001 and continuing up to and
     including September 12, 2006 (the "Term").

3.   WHEN OPTION MAY BE EXERCISED

     (a)  In this section 2, "Acceleration Price" shall mean $9.47.

     (b)  Subject to section 2(c), the Optionee may exercise the Option with
          respect to all or from time to time any part of:

          (i)   1/3 of the Optioned Shares on or after September 12, 2002;

          (ii)  1/3 of the Optioned Shares on or after September 12, 2003; and

          (iii) 1/3 of the Optioned Shares on or after September 12, 2004.

     (c)  If the Market Price exceeds the Acceleration Price at any time before
          September 12, 2004, the Optionee may at any time thereafter exercise
          the Option with respect to all or from time to time any part of the
          Optioned Shares.

4.   PROCEDURE FOR EXERCISE OF OPTIONS

     (a)  The Option may be exercised by the Optionee or his personal
          representatives at the applicable times and in the applicable amounts
          by giving to the Corporation at its principal executive office written
          notice of exercise specifying the number of Shares to be subscribed
          for. Such notice must be accompanied by full payment for the Shares to
          be subscribed for. Upon any such exercise of the Option, the
          Corporation shall forthwith cause the transfer agent and the registrar
          of the Corporation for the time being to deliver to the Optionee or
          his personal representatives (or as the Optionee or his personal
          representatives may otherwise direct in the written notice of
          exercise) a certificate or certificates in the name of the Optionee or
          his personal representatives (or as otherwise directed in the written
          notice of exercise) representing in the aggregate such number of
          Shares as the Optionee or his personal representatives shall have then
          paid for.

     (b)  All Shares subscribed for under the Option shall be paid for in full
          in cash at the time of subscription.

     (c)  Except as contemplated by sections 5 (Non-Transferability of Options),
          6 (Death, Retirement or Permanent Disability of Optionee) and 7


<PAGE>


          (Termination of Employment of Optionee), the Option may be exercised
          in whole or in part at any time only if, at the time of such exercise,
          the Optionee is an Employee or a Director.

5.   NON-TRANSFERABILITY OF OPTIONS

     The Option is not assignable or transferable by the Optionee and any
     purported assignment or transfer of the Option shall be void and shall
     render the Option void; provided that in the event of the termination of
     employment of the Optionee by reason of death, the Optionee's legal
     personal representative or representatives may exercise the Option in
     accordance with section 6 (Death, Retirement or Permanent Disability of
     Optionee).

6.   DEATH, RETIREMENT OR PERMANENT DISABILITY OF OPTIONEE

     (a)  In the event of the termination of employment of the Optionee by
          reason of death of the Optionee at any time during the term of the
          Option, the Option may, to the extent only that it is exercisable
          under section 3 (When Option May Be Exercised) be exercised no later
          than the later of:

          (i)   90 days after the earlier of the date of the grant of probate of
                the will or letters of administration of the Optionee's estate
                and the first anniversary of the date of death, and

          (ii)  90 days after the end of the fiscal year of the Corporation in
                which death occurred,

          and in any event prior to the end of the Term, and after the later of
          the dates referred to in section 6(a)(i) and section 6(a)(ii) the
          Option shall terminate and be void.

     (b)  In the event of the termination of employment of the Optionee by
          reason of his or her retirement from the Corporation or any of its
          Subsidiaries pursuant to the Retirement Plan for Salaried Employees of
          the Corporation, as amended from time to time or any replacement
          therefor, the Option may, to the extent only that it is exercisable
          under section 3 (When Option May Be Exercised), be exercised no later
          than the earlier of:

          (i)   90 days after the end of the fiscal year of the Corporation in
                which the Optionee retired; and

          (ii)  the end of the Term

          and after such date the Option shall terminate and be void.

     (c)  In the event of the termination of employment of the Optionee by
          reason of his or her becoming permanently disabled, the Option may, to
          the


<PAGE>


          extent only that it is exercisable under section 3 (When Option May Be
          Exercised), be exercised no later than the earlier of:

          (i)   90 days after the end of the fiscal year of the Corporation in
                which the Optionee became permanently disabled; and

          (ii)  the end of the Term

          and after such date the Option shall terminate and be void.

     (d)  Notwithstanding the provisions of sections 6(b) and 6(c), where the
          Optionee dies subsequent to his or her retirement or becoming
          permanently disabled and prior to the later of the dates set forth in
          sections 6(b)(i) or 6(c)(i) (as applicable) and the end of the Term,
          the Option may, to the extent only that it is exercisable under
          section 3 (When Option May Be Exercised), be exercised by the legal
          personal representative or representatives of the Optionee no later
          than the later of:

          (i)   90 days after the earlier of the date of the grant of probate of
                the will or letters of administration of the Optionee's estate
                and the first anniversary of the date of death, and

          (ii)  90 days after the end of the fiscal year of the Corporation in
                which death occurred,

          and in any event prior to the end of the Term, and after the later of
          the dates referred to in section 6(d)(i) and section 6(d)(ii) the
          Option shall terminate and be void.

7.   TERMINATION OF EMPLOYMENT OF OPTIONEE

     (a)  In the event of the termination of the employment of the Optionee for
          any reason (including termination by resignation by the Optionee)
          other than termination for lawful cause or as specified in section 6
          (Death, Retirement or Permanent Disability of Optionee),

          (i)   when the termination of employment of the Optionee occurs before
                the Option becomes exercisable under section 3(a), the Option
                shall terminate and be void and the Optionee shall have no
                rights under this Agreement or under the Plan; and

          (ii)  when the termination of employment of the Optionee occurs after
                the Option becomes exercisable under section 3(a), the Option
                may, to the extent only that it is then exercisable under
                section 3(b), be exercised by the Optionee no later that
                30 days after the date of termination of employment and upon
                expiration of that period the Option shall terminate and be
                void.


<PAGE>


          For the purposes of sections 7(a)(i) and 7(a)(ii), only, "termination
          of employment of the Optionee" shall occur when the Optionee ceases
          to report for work or ceases to perform his or her duties, and for
          greater certainty shall not be interpreted to mean the end of any
          notice period or period during which any benefits arising from the
          Optionee's former employment relationship with the Corporation are
          found to be extended to or accrue to the Optionee, or to which the
          Optionee may be or be found to be entitled.

     (b)  Nothing contained in the Plan or this Agreement confers on the
          Optionee any right to, or guarantee of, continued employment by the
          Corporation or any Subsidiary or any combination or partnership
          thereof, or in any way limits the right of the Corporation or a
          Subsidiary or any combination or partnership thereof to terminate the
          employment of the Optionee at any time.

8.   TERMINATION OF THE PLAN

     If the Plan is terminated, the provisions of the Plan and any
     administrative guidelines and other rules and regulations adopted by the
     Committee and in force on the date of termination will continue in effect
     as long as the Option or any rights pursuant thereto remain outstanding
     but, notwithstanding the termination of the Plan, the Committee shall
     remain able to make such amendments to the Plan or the Option as they would
     have been entitled to make if the Plan were still in effect.

9.   GENERAL REQUIREMENTS

     The Option is subject to the requirement that if at any time the Committee
     shall determine that any agreement, undertaking or other action or
     cooperation on the part of the Optionee, including in respect to a
     disposition of the Shares, is necessary or desirable as a condition of, or
     in connection with (i) the listing, registration or qualification of the
     Shares subject to the Plan upon any stock exchange or under the laws of any
     applicable jurisdiction, or (ii) obtaining a consent or approval of any
     governmental or other regulatory body, the exercise of the Option and the
     issue of Shares thereunder may be deferred in whole or in part by the
     Committee until such time as the agreement, undertaking or other action or
     cooperation shall have been obtained in a form and on terms acceptable to
     the Committee.

10.  ADJUSTMENT OF OPTION

     (a)  Upon the occurrence, from time to time, of any of the following events
          during the Term:

          (i)   the issue to all or substantially all holders of Shares, by way
                of a stock dividend or otherwise, of Shares or securities
                convertible into Shares (other than dividends in the ordinary
                course);


<PAGE>


          (ii)  the issue to all or substantially all holders of Shares of
                rights, options or warrants pursuant to which those holders are
                entitled to subscribe for, purchase or otherwise acquire Shares
                or securities convertible into Shares; or

          (iii) the issue or distribution to all or substantially all holders of
                Shares, of (i) shares of any class other than Shares, or (ii)
                rights, options or warrants, or (iii) evidences of indebtedness,
                or (iv) any other assets (other than dividends in the ordinary
                course);

          the Option Prices and the number of Optioned Shares shall be adjusted
          if and to the extent that the Committee considers it to be equitable
          and appropriate.

     (b)  In the event of a change in the capitalization of the Corporation
          contemplated by section 15 of the Plan, the Option shall be adjusted
          in accordance with the provisions of sections 15.1 or 15.2 of the
          Plan, as applicable.

     (c)  If a dispute shall at any time arise with respect to adjustments of
          the number of Optioned Shares, the dispute shall be conclusively
          determined by the Committee.

11.  THE PLAN

     The Optionee acknowledges that this Agreement and the Option are subject to
     the terms and conditions of the Plan as approved by the relevant regulatory
     authorities. In particular, and without limitation, the Optionee
     acknowledges that the Option is subject to provisions of the Plan regarding
     the acceleration of the time of exercise of the Option (sections 7.5 to 7.7
     of the Plan); the effect of the Optionee's participation in the Plan on any
     related rights and other benefit plans the Optionee has or may participate
     in (section 9 of the Plan); the prohibition on fractional Shares being
     issued upon exercise of the Option (section 11 of the Plan); and the right
     of the Corporation to withhold certain amounts from payments made to the
     Optionee (section 19 of the Plan).


<PAGE>


12.  SUCCESSORS AND ASSIGNS

     This Agreement shall enure to the benefit of and be binding upon the
     Corporation, its successors and assigns, and the Optionee and his personal
     representatives to the extent provided in section 6 (Death, Retirement or
     Permanent Disability of Optionee) hereof.

IN WITNESS WHEREOF the Corporation has hereunto affixed its common seal duly
attested by the hands of its proper officers in that behalf and the Optionee has
hereunto affixed his hand and seal as of the date first written above.



THE CORPORATE SEAL of NORSKE              )
SKOG CANADA LIMITED was                   )
hereunto affixed in the presence of:      )
                                          )
                                          )
----------------------------------------  )
Authorized Signatory                      )
                                          )                                  c/s
                                          )
----------------------------------------  )
Authorized Signatory                      )


SIGNED, SEALED and DELIVERED by           )
[NAME OF EXECUTIVE] in the presence of:   )
                                          )
                                          )
----------------------------------------  )
                                          )
----------------------------------------  )    ---------------------------------
                                          )    [NAME OF EXECUTIVE]
----------------------------------------  )
                                          )
----------------------------------------  )