Pellet plant superintendent and an electrical contractor stand in front of the pellet machine inside the Skeena Bioenergy plant beside the Skeena Sawmills on Hwy 16 West. (Skeena Sawmills photo)

Skeena Bioenergy pellet plant enters long-term agreement with Pacific BioEnergy

The international supplier will purchase product to export onto Japanese markets

Skeena Sawmills Ltd.’s $20 million pellet plant now has a way to export product from Terrace overseas, solidifying a new category of value-added wood products for the city.

The sawmill announced Feb. 1 subsidiary Skeena Bioenergy has entered a long term agreement with international supplier Pacific BioEnergy of Prince George to ship all of its production to Japan power producers via port facilities in Prince Rupert and Vancouver.

The plant is located adjacent to the Skeena Sawmills mill on Hwy 16 west of Terrace and is expected to start production in March 2019, producing around 75,000 tonnes of pellets per year.

The finished product will be contained in two silos and then deposited via telescopic chutes into waiting trucks or containers underneath for transport. The silos arrived on the plant this week as it enters the final stage of construction.

In addition to Japan, Skeena Bioenergy is also looking at tapping into other wood pellet markets including Europe, China and Korea.

“We’re already heavily engaged with the [Port of Prince Rupert] through our lumber business so we think there’s going to be opportunity to continue to utilize what we think is a competitive advantage with the Port of Prince Rupert, but also the markets that will be served through break-bulk shipments out of Vancouver,” says Skeena Sawmills sales and marketing vice president Rick Harris.

READ MORE: Pellets adding value to resource at Skeena

While the company could not confirm the value of the agreement, Harris says the partnership with Pacific BioEnergy will be a “profitable contributor to the business and to the region.”

Commenting on the agreement, president of PacBio John Stirling said in a press release, “This agreement with Skeena Sawmills contributes to our growing presence serving Japan’s demand for bioenergy products and advances our vision of bringing greater value to B.C.’s forest industry.”

The plant will progress to 24/7 operations in a phased manner, starting with single eight-hour shifts over five days before progressing to two eight hour shifts, then if successful, 24-hour a day operations for five days a week before the seven-day transition.

At full capacity, the plant is expected to create an additional 22 to 25 jobs.

Pacific BioEnergy has access to 100 per cent of the product produced at the pellet plant under its agreement with Skeena Sawmills, but Harris says there is flexibility to supply regional programs and business opportunities that arise in the future.

“Skeena’s pellet plant provides a critical outlet for residual fibre from the sawmill and builds on our commitment to maximizing value from the forest resource and generating local jobs from local logs in Northwestern British Columbia,” says Harris in a press release.

Between 75 to 80 per cent of the wood fibre will come from waste from the Skeena Sawmills, with 20 to 25 per cent from outside suppliers with opportunities to increase depending on supply.

Examples of possible sources include other sawmills within the region, wood waste from the Skeena Industrial Development Park or from land cleared for LNG Canada’s facility in Kitimat.

In the past, the sawmill would sell excess waste wood to other pellet producers including the Harmac pulp mill on Vancouver Island or loaded into the Kitsumkalum landfill. The sawmill has since been stockpiling its waste wood in anticipation of the pellet plant’s startup.

“Producing pellets from bark and sawdust (approx. 20 per cent of the log volume) makes this material a valuable product vs a waste,” wrote operations vice-president Roger Keery in an email to the Terrace Standard. “This improves the sawmill economics and supports the capital investment to modernize the sawmill.”

READ MORE: Skeena Sawmills spending millions to modernize

Turning a product that was formerly a line-item cost into a source of revenue will add value to the resource and allow the sawmills to increase their capacity from one shift to two shifts and afford measures to make their operations more efficient, Harris says.

So far, a new canter line which is used to break down lumber has been ordered, but upgrades to the sawmill will wait until the new pellet plant is up and running.

—with files from Jackie Lieuwen and Rod Link


 


brittany@terracestandard.com

Like us on Facebook and follow us on Twitter

Just Posted

Province announces $100-million grant funding for Northwest communities

The Northern Capital and Planning Grant will go to four regional districts and 22 municipalities

Security guard now on patrol at three Terrace banks

Company hired to secure ATM vestibules due to safety concerns

LNG Canada sponsors fast-tracked driver’s license training in Terrace, Kitimat

The $80,000 contribution is part of the company’s commitment to hire locally

Prince Rupert Gas Transmission project searches for partners

TransCanada is renewing permits for its natural gas pipeline project to North Coast.

Coastal GasLink stops work to investigate archaeological find

OGC archaeologists are en route to the Houston-area site where Unist’ot’en report finding stone tools

B.C. students win Great Waters Challenge video contest

Video, mural and song about saving the salmon claims the top prize

B.C. athlete takes home gold in freestyle aerials at Canada Games

Brayden Kuroda won the event with a combined score of 121.65.

Cabinet likely to extend deadline to reconsider Trans Mountain pipeline

New round of consultations with Indigenous communities is coming

B.C. government provides $75,000 towards salmon study

Study looks at abundance and health of Pacific salmon in Gulf of Alaska

Murdered and missing honoured at Stolen Sisters Memorial March in B.C.

‘We come together to make change within the systems in our society’

UBC researchers develop inexpensive tool to test drinking water

The tricoder can test for biological contamination in real-time

Disgraced ex-Congressman Anthony Weiner released from prison

He was convicted of having illicit online contact with a 15-year-old North Carolina girl in 2017

B.C. communities push back against climate change damages campaign

Activists copying California case that was tossed out of court

Most Read