Abitibi-Consolidated to build biomass boiler in Fort Frances.

At a time when mill closures are becoming a familiar sight throughout the forestry industry, Abitibi-Consolidated Inc. has announced an $84.3 million investment to construct a new biomass energy generator at its Fort Frances pulp and paper mill.

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"This is very, very important," says Mayor Roy Avis.

"With this coming, it makes it economically feasible to continue, so that our mill is not one of the ones to be slated for closure. Businesses can plan for the future now, and anybody that's tied to the logging or forestry industry can now feel free to circulate their money in the community, so that's a very big plus for us."

Construction for the new facility is slated to begin this summer, and is anticipated to be completed fall of 2008. Using wood waste generated by its mill and others in the area, as well as forest slash from its woodlands operations, the biomass boiler will generate steam and 45.5 megawatts of electricity for the mill. The provincial government is also contributing to the project in the form of a $22.5 million grant through the Forest Sector Prosperity Fund.

By making use of renewable, cost-effective fuel, Abitibi-Consolidated is seeking to reduce its reliance on increasingly unstable energy prices. Currently, the mill is making use of natural gas in cogeneration at the Fort Frances mill, though the fluctuating cost of that energy source has pushed the company to consider biomass.

"Basically, we need to make sure our mills are cost-competitive so we're always looking for a way to improve productivity and reduce our operating costs," says Denis Leclerc, spokesperson for Abitibi-Consolidated. "Over the last two years, we have evaluated a range of alternatives, and the waste fuel boiler has been identified as the best solution for the mill."

While the cogeneration boiler will continue to be used throughout the life of the new biomass boiler, it will have a smaller role and will no longer be used at full capacity.

Between the new biomass and existing cogeneration facilities, as well as the company's local hydro-electric dams, the Fort Frances facility will be 86 per cent energy self-sufficient. This is a key component for the economic sustain-ability of the mill, Leclerc says, as it considerably reduces the risk associated with rising energy prices, which constitute 32 per cent of its operating costs.

The project also features an additional "green" component in the form of considerably reduced greenhouse gases, whose emissions will shrink by 90 per cent as a result of the conversion to biomass.

On an annual basis, the Fort Frances mill produces 285,000 tonnes of commercial printing paper, and 116,000 tonnes of market kraft pulp.

The Fort Frances mill employs 650 people, while 350 are contracted for the associated woodlands operations. The project will not only help to preserve these jobs, but will also create a variety of related positions. Following the completion of construction, approximately 50 jobs will be created for biomass harvesting and transportation. Nearly 150 workers are also expected to be contracted for the construction phase of the project.

These workers have helped to make the biomass boiler economically viable, Leclerc says. In January, the local unions agreed to contract extensions providing long-term labour stability for the site.

"During the 2009 contract negotiations, we want to make sure that the mill will stay under operation, because when you're building this and ramp up the operations of such a boiler, you need to have a rapid return to your investment right at the beginning."

Although it's not due to be completed for another year, the announcement of this development has already had an impact on the mental well-being of the community.

"I've been running my business here in town for 40 years, and I've seen a change in the atmosphere here since this has been announced," says Avis, who owns West End Motors, a Chrysler dealership. "The community has more openness, and there's a feeling of security. Overall, the feeling in the community is much better, and not only in Fort Frances but in the whole district, which is very good to see."

www.abitibiconsolidated.com

www.fort-frances.com

By NICK STEWART

Northern Ontario Business