Fuelling the forests. A project check up

IT HASN’T quite matched the first waves of people and companies who came to the northwest to carve out a living from its forests, but the last several years have seen a stream of next-generation entrepreneurs promoting their ideas of turning a profit from local wood.

  • Feb. 23, 2011 3:00 p.m.

IT HASN’T quite matched the first waves of people and companies who came to the northwest to carve out a living from its forests, but the last several years have seen a stream of next-generation entrepreneurs promoting their ideas of turning a profit from local wood. And unlike the early days which first focused on sawing lumber and later making pulp, this newer wave has featured more exotic plans as well as some of the traditional methods. Some have been drawn by the virtual absence of any kind of manufacturing facility at all that would compete for the annual allowable cut or for the attention of local governments eager to return some measure of economic stability to the region. And some have been drawn by the Northwest BC Forest Coalition, now nearly two years old, and the brainchild of forests minister Pat Bell. The coalition, a group of 11 area forest tenure holders, stakeholders, tribal groups, and local communities between the Prince Rupert North Coast area to Hazelton, has seen a few of these ideas come by in the last couple of years. Coalition member Norm Parry, a senior manager in the region with the crown agency BC Timber Sakes, thinks the coalition has been beneficial for area, saying that proponents have told them they like the ability to meet with a group of licensees and have a one-stop shop opportunity for the region. “We’ve had some positive feedback, that this is the best they’ve seen in their trip to North America,” he said. “All the information is presented.” All told, the coalition boasts 2,700,000 cubic metres of uncommitted timber harvest available each year, which consists of roughly 70 per cent of the volume available in the northwest. It has been promoting the region as ideally located for a sawmill, a pulp and paper mill, pellet mill or other wood processing investment. Since its beginnings a couple of years ago, Parry says the coalition has seen about 20 companies or proponents visit the northwest looking at industry possibilities. Parry explained that while there is a range of the type of products the companies think they can produce here, most have concentrated on turning wood into some form of fuel suitable for either heating or power generation. “The most active is ways we can utilize the residual volume from harvesting,” Parry said of proponents looking at fibre supply here. “But there have been some that are looking for logs itself, some that are looking for wood to make engineered wood products from…there is a spectrum there.” Rick Brouwer, the executive director of the Skeena-Nass Center for Innovation in Resource Economics (SNCIRE), agrees that there have been quite a few companies that have come around looking at possibilities in the region. Brouwer points out that there are many companies on different levels of readiness; some groups have come to the Skeena-Nass region for a site visit, but there are many other enquiries that never get to this stage. “We’re very open, we will entertain discussions with everybody, and afterwards, hopefully, we’re able to attract some of the ones who have a…better potential to come and talk to us face to face,” Brouwer said. Parry agrees. “We’ve had a good flurry of activity for the first two years, and we’ve done some really interesting and innovative things for making fibre available,” he said. But he acknowledged that sometimes many companies need to take a look at the area before one will decide to go ahead with a facility. He pointed out that some businesses had originally contacted the coalition with potential pellet plant ideas, bio-fuel plant concepts, or chip exporting terminals, but haven’t been in touch since. The list of names includes Biomass Secure Power Inc., Pristine Power (since sold to Calgary-based Veresen Power), JL Shipton Contracting and General Biofuels. The latter company, which says it is international in scope, maintains a website indicating it produces pellets from southern BC. But another section of its website, referring to a Canadian subsidiary, would have readers believe it produces pellets right here in Terrace. “General Biofuels Canada is a producer of wood pellets from sustainably harvested sources,” reads the site. “We source our fibre from the Northern Hemlock forests surrounding Terrace, BC,” it continues. In any event, it looks like the closest that General Biofuels has come to building any type of plant here rests with two early 2010 press releases. One indicated it had an option with the city to buy a portion of the former Terrace Lumber Company lands on which to build a large pellet-producing plant. It was also in talks with local First Nations forest companies and other forest licence holders to lock up a fibre supply. The option has now expired, city officials haven’t heard from the company for awhile and it isn’t returning phone calls. Swedish-owned energy company Vattenfall toured the area last year, interested in turning northwest wood into black pellets for what it says is a growing European demand. It was part of a world-wide scouting expedition with Vattenfall’s Canadian contact, Bill Sinclair, saying the company has “narrowed its search for both partners and fibre and is now seeking board approval for next steps.” No hints of where exactly the company is looking were provided. One company that has crossed Terrace off its list is GV Energy Inc., which signed a non-binding agreement in 2009 with the city for 100 hectares of its planned airport industrial park. That’s where GV Energy wanted to build a refinery, converting wood into a transportation fuel called Dimethyl Ether (DME). Any type of tree and quality could be used, and the refinery was estimated to cost a minimum of $100 million and would employ around 40 to 50 people. The non-binding referendum with the city has expired and was not renewed. “It is unlikely we will proceed,” said GV Energy’s Eric Switzer, explaining that the increase in whole log exports to China has raised the price of fibre to the point his company could not afford to buy fibre. “It seems that the current industrial policy in the area is to rely on the sale of natural resources to the detriment of the creation of industries that have the potential for long-term value added,” he said. Not all of the wood plans for the northwest have fallen through, however. Part two running next week concentrates on projects which have made it past the first feasibility stages.