Town may convert mothballed mill: a Quebec company is looking at producing wood chips and hog fuel at a vacated Tembec sawmill in Opasatika.

Opasatika -- Wood waste may quickly become a valued commodity across northeastern Ontario with a Quebec company proposing a wood chip processing plant inside a vacated Tembec sawmill.

The Township of Opasatika and Products Forestier Cyclofor are eyeballing the conversion of Tembec's former Excel softwood lumber sawmill into a biomass plant producing wood chips for the pulp and paper industry and hog fuel for co-generation plants.

Tembec closed the expansive 69,000-square-foot plant last June. The township of 325 people lost 78 jobs.

Now Cyclofor, a biotechnology company based in Palmarolle, Que., has come forward with an innovative and patented new technology that converts wood waste into chips.

The company is currently building a $23.3-million plant in La Sarre, Que., that is expected to create 150 jobs.

Daniel Gingras, chairman of Opasatika's adjustment committee, says similar plans are in the works for Opasatika. He says he anticipates a local facility would create about 30 woodland operations jobs, 70 positions at the plant itself and another 50 in transportation.

Company officials first visited the Excel mill in October and signed a letter of agreement with the municipality to build a plant, tentatively, in 2006.

Wood residue, such as treetops, branches and trunks are recovered at the cutting sites using specialized retrieving and compacting machinery developed by company president Daniel Tardif. The waste is then trucked to a processing plant to be made into wood chip by-products.

The company's business plan calls for 40 per cent of the wood chips to be earmarked for use at area paper mills. The rest would be used for co-generation plants and other heating applications.

There are no definite time-lines on any construction plans.

"There's no problem finding (wood waste) but we need authorization from (Natural Resources minister David) Ramsay and we are awaiting his decision about that," says Alain Brodeur, Cyclofor's manager of forestry operations.

The municipality is pursuing a consultant for a feasibility study on what the volume, characterization and availability of forest scrap within a 200-kilometre radius of the township is.

Tembec stands to be an important partner in this project, Gingras says, since the forest scrap would likely be taken from the company's cutting sites. Cyclofor will want to sell the chips back to the forest products giant via their paper mills in Kapuskasing and Smooth Rock Falls.

Gingras says Cyclofor's biomass proposal in Quebec was considered "so unique and new in the forestry industry" it took the company three-and-half-years to get approval from the Quebec Department of Natural Resources for permission to recover the wood waste and to authorize the technology.

He's hoping there won't be a similar time lag in from the Ontario Ministry of Natural Resources.

The municipality wants to finalize plans by the spring to proceed with the project.

Last fall, Tembec agreed to sell the building to the Municipality of Opasatika for $1.

While negotiations remain ongoing with the township, Tembec has agreed not to sell the sawmill property to any other interested party until March 31. The deadline is to ensure that Cyclofor proceeds with their plans and Tembec appears to be flexible with the date.

The municipality would buy the building and rent it to Cyclofor, Gingras says. They are now in the phase of conducting an environmental assessment of the Tembec site along with a building structural analysis.

Gingras says a major challenge will be to get provincial permitting to go into Hearst's and Gordon Cosen's forest management units to recover the wood residue.

An ongoing debate is persists in the northeastern region as to who owns wood waste lying in the bush. Forestry companies maintain the material belongs to them through provincially granted cutting rights and because they built the bush roads to access the fibre. But the Ministry of Natural Resources maintains scrap wood belongs to the province and forestry companies only have cutting rights to standing lumber.

"Those issues we still have to resolve," says Gingras.

In searching for other uses of the sawmill, Gingras says other ideas on the table include establishing a flooring plant using tamarack. One such plant exists in eastern Canada; the Opasatika project would be the first of its kind in Ontario.

They are also considering setting up a ceramic and brick manufacturer using clay mined from the area.

With Opasatika located in the heart of northeastern Ontario's claybelt, Gingras says the region has beautiful brown and red clay near the Agrium Phosphate Mine and 80 km north of town, where logging companies are harvesting. They plan on doing an analysis of the clay content to determine its suitability for manufacturing.

www.tembec.com

www.geocities.com/opasatika_ontario

By IAN ROSS 

Northern Ontario Business