Bio-Insight

"At a time when the global economy is still fragile, clean energy projects are helping to drive the transformation of Canada's forest sector toward a more secure future," said Minister Merrifield. "Challenging market conditions have pushed this industry to seek out new partnerships and explore the broad range of products wood can yield. Through strategic investments, our Government is helping create the conditions for success today and beyond."

Weyerhaeuser is investing its credits in a new turbine generator so its Grande Prairie pulp mill can better meet its own energy needs and sell excess electricity to the grid. As a result, approximately 2,800 homes in regions that need electricity will have access to carbon-neutral power.

"This investment is good news for Weyerhaeuser, its workers and the surrounding community," said Mr. Warkentin. "By expanding its line of forest products to include clean energy for the homes and businesses in Alberta, Weyerhaeuser is able to continue sustaining quality jobs in this region."

"By supporting energy efficiency and renewable energy production, the federal government's Pulp and Paper Green Transformation Program is a significant contribution to a green and sustainable future for Canada's pulp and paper sector," said Anne Giardini, President of Weyerhaeuser Company Limited. "This program helps to position Weyerhaeuser as a leader in the production of renewable energy from forest biomass."

"The support shown by Canada with this investment, together with the support from Alberta for this new turbine generator, has served as a catalyst for additional investment at the Grande Prairie mill that will result in the generation of even more renewable energy," added Giardini.

The total value of the turbine generator project is approximately $50 million. The Government of Alberta is contributing $4.5 million and Weyerhaeuser is investing the remaining amount.

"Alberta's bioenergy programs support companies like Weyerhaeuser as they improve their environmental performance and increase their production of renewable energy," said Wayne Drysdale, Member of the Legislative Assembly for Grande Prairie-Wapiti. "This project is a win for the paper and pulp sector as it becomes more environmentally sustainable, a win for Alberta as we achieve cleaner energy production, and a win for our communities as new funding for projects continues to attract new private sector investment to Alberta."

Today's announcement builds on the success of many initiatives that are helping to sustain and enhance Canada's forest industry and the families and communities that depend on it. Budget 2010: Leading the Way on Jobs and Growth established the $100-million Investments in Forest Industry Transformation program to promote the development, commercialization and implementation of advanced technologies in the forest sector - helping create a world-class industry able to compete in the clean energy economy of tomorrow.

In addition, under Canada's Economic Action Plan the Government has committed $170 million to assist the development of next-generation forest products and expand global markets for Canadian forest products. This funding includes $40 million to develop pilot-scale demonstrations under the Transformative Technologies Program.

The project will be funded in part by a 7.5 M€ loan (C $10 million) to be provided by a syndicate of French banks. The loan has a term of seven years at a rate of Euribor 3 months plus 2%.

With approximately 300,000 metric tonnes of capacity, Tembec is among the global leaders in the specialty dissolving pulp business. Tembec's specialty cellulose division (Cellutions) is a leading producer of dissolving pulp for the cellulose derivatives market that includes Cellulose Acetate, Cellulose MCC, Cellulose Ethers and Nitrocellulose.

"Tembec's specialty dissolving business has been and will remain one of the Company's core businesses. The Tartas turbine investment will reposition that mill as a first quartile cost producer of specialty dissolving pulp generally, and particularly in its key grades of Cellulose Ethers and Nitrocellulose where it is the world's largest supplier," said Yvon Pelletier, Executive Vice President and President, Specialty Cellulose and Chemical Group.

"Ten years ago, the Tartas mill was restricted in its ability to produce these dissolving grades. Today, through a series of investments, the mill now has the capability to direct virtually all of its output into these products, with more than 90% of the production capacity currently dedicated to the specialty dissolving business. This project builds on those earlier investments and will result in energy, environmental and economic benefits - a great combination," concluded Mr. Pelletier

In addition to the projected economic benefits, this investment will improve mill reliability with the retirement of a smaller and less efficient 40-year old steam turbine. This project will also help the site avoid disruptions associated with power interruptions and fluctuations from the grid.

"Tartas is a key facility in one of Tembec's core businesses. The project announced today will position the Tartas mill as one of the lowest cost producers of specialty dissolving pulp in the world," said James Lopez, President and CEO of Tembec. "This investment is consistent with Tembec's overall strategy of having all of its assets in the first or second quartile of their respective cost curves."

Tembec is a large, diversified and integrated forest products company which stands as the global leader in sustainable forest management practices. The Company's principal operations are located in Canada and in France. Tembec's common shares are listed on the Toronto Stock Exchange under the symbol TMB and warrants under TMB.WT. Additional information on Tembec is available on its website at http://www.tembec.com/

The new Andritz recovery boiler at Cacia “runs like a Swiss watch”. The two older units to the right have been decommissioned

All to the grid

What is interesting is that none of the energy generated by the boilers is used by the mills. This is not permitted, according to Portugal's directives for "green energy" credits, so the electricity is sold directly to the national grid. "Even without these boilers, we are energy self-sufficient at this mill," says José Manuel Nordeste, mill manager at the Cacia pulp mill.

The situation is a bit different at Setúbal. "The installation of a new and very large paper machine at our site requires some purchase of power," says Setúbal's pulp mill manager Óscar Monteiro Arantes. "However, the extra margin we receive for green energy still makes it attractive."

From left, Cacia project director António Gomes, Andritz agent José Henriques and mill manager José Manuel Nordeste

Value-added pulping and energy

The Portucel Soprocel Group is responsible for about 65% of Portugal's total electricity produced from renewable forest biomass. "Renewable energy is a key focus in the world," Nordeste says, "and is a major focus for us. It is important for us to be players in this industry to ensure that order is maintained in the market. Forestry resources are our lifeblood. There is a potential threat if we let others control the resource, or simply burn it, before we can add value to it."

The biomass boiler projects consisted of the supply of two identical bubbling fluidized bed (BFB) boilers with a total production capacity of 49.75 MWth. According to Jukka Kari, Andritz's project manager, the boilers are mid-size (58 tonnes/hr, 93 bar, and 472º C).

Operator at the Cacia mill’s biomass boiler to optimize performance

Portucel Soporcel's scope included the civil/structural work and part of the electrification and automation. "Andritz basically provided everything above the foundations from the fuel feeding conveyor to the main steam header in the turbine-generator plant," Kari says. Contracts were signed in February 2008 the boilers were mechanically complete in the fall of 2009.

Investments at Setúbal

The group has made considerable investments in upgrading the Setúbal mill, which started up in 1967. The Setúbal site is situated just 4 km from a port, making transportation of finished goods very efficient. The mill produces 530,000 tonnes/yr of bleached pulp, primarily from the preferred Eucalyptus globulus fiber.

Arantes estimates the total recent investment to be €550 million ($750 million) for a new paper machine, new combined heat/power plant, fiberline retrofits, and the biomass boiler.

"We use about 150,000 tonnes/yr of biomass as a fuel here at the mill," Arantes says. "About 80% of our logs are debarked before entering the mill. We use special harvesting and binding equipment to gather forest waste and put it into small bundles for transport."

In addition to providing green energy, the removal of forest waste has another large benefit: a reduction in forest fires. "By removing the waste from the forest floor, we actually reduce the risk and impact of fires," Arantes explains. "We do not remove everything however. Our forestry experts know where they can remove without damaging the soil."

As for the boiler itself, Arantes says: "Andritz kept all the contract milestones on-time or ahead of schedule. The startup was without complications, it went into service quite smoothly. The design of the boiler is good. There is good flexibility to burn different biomasses with different moistures."

Setúbal pulp mill manager Óscar Monteiro Arantes (left) with José Henriques in front of the biomass pile at Setúbal

Excellent reference at Cacia

Cacia is midway up the nation of Portugal, about 8 km from Aveiro and very close to the sea. "Cacia is in the heart of our country's eucalyptus forests," says Nordeste. "The proximity of this raw material is a key advantage for us." Cacia's production of 285,000 tonnes/yr is primarily designed for special applications such as décor papers, specialty coated papers, and tissue.

The recovery boiler at Cacia played a key role in deciding the supplier for the biomass power boiler project, according to Nordeste. "One of the strongest references for Andritz was the new recovery boiler they installed here in 2006," Nordeste says. "Our two old units were at end-of-life. We would not be able to make the other improvements to the fiber line and the rest of the mill without this new recovery boiler operating well. It works perfectly, like a Swiss watch.

"Yet power boilers are different," Nordeste adds. "You can make big mistakes in handling and burning eucalyptus bark. It comes in long, stringy strips and must be cut correctly."

Inside the BFB biomass power boiler at Setúbal

One major challenge, according to António Gomes, project director for the biomass boiler project and now Cacia's production manager, is that the mill never knows what kind and quality of biomass they will be receiving. "We see all kinds of contaminants in terms of metals, concrete, and other things," he says. "You need a very robust and reliable boiler system to handle it."

Flexibility in handling varying fuels and moistures is also key. "We needed a very flexible boiler to handle the range of biomass and the ranges of moisture," he says. "Depending upon the season, we go from 45% moisture in the spring to 60% in the winter."

As with Setúbal, the boiler project proceeded without a glitch. The boiler was mechanically complete in September 2009 and was commissioned and started up in a very smooth fashion.

"To me it is quite simple," Nordeste states. "The equipment works well. The supplier's project team knew what they were doing and the process knowledge is there. And, if something ever goes wrong, we know the supplier has the willingness and capacity to make it right."