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Resolute Forest Products to mobilize for construction in March

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“You’ll see things start happening fast in April,” Resolute Forest Products’ Michael Martel told Council Monday.

Martel, Resolute’s vice-president of forest products operations, is in charge of the construction of the company’s new mill at Sapawe. He met with Council Monday to update them on the project.

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So far, Resolute has committed about $25 million of the expected $62 million cost; most of the rest is being tendered now.

Rainy Lake Tribal Contracting has been working to prepare the site since last summer. Nearly all of the old buildings are gone (the old mill’s foundation is still place; Martel said Resolute may use it later), and the site has been levelled for construction. That involved moving 120,000 cubic metres of rock (some of which went to replace a twenty-foot-deep sawdust dump at the kiln site), and removing about 300 truck loads of garbage and waste.

“We will mobilize for construction in March, and start foundation work by the end of that month,” he said. “We expect to have about 100 working at the site for a year.”

The Sapawe operation will be a “sister” to Resolute’s facility in Ignace, and will be operated in close conjunction with it and its Thunder Bay facilities.

“Our target is to get the best value out of each log,” said Martel. The three lumber mills (Sapawe, Ignace, Thunder Bay) will each specialize in particular products, and Resolute’s pulp & paper and pellet mills in Thunder Bay will get the fibre best-suited to their operations. Sawlogs will be sorted in the bush to go to the appropriate mill, and poorer quality logs will be chipped right in the bush.

The Sapawe mill will include a planer (the most modern in North America) and a kiln, and will produce a variety of lumber (1×3, 1×4, 2×3, 2×4, 2×6 and 2×10) in eight and sixteen foot lengths. The production target here will be 150 million board feet per year, about 50% more than the old mill’s typical output.

The natural gas-fired kiln here will also handle logs for the Ignace mill; it’s annual capacity will be 265 million board feet per year. (The company’s Thunder Bay mill lists annual production at 300 million board feet.)

Martel said the company aims to have the kiln installed and running by the end of 2014, with the planer commissioned in the early spring of 2015 and the sawmill in full operation in May or June of 2015.

Resolute is still working on sorting out transportation issues, which at this point appear to present it the biggest challenge to realizing its plans.

Once this mill is up and running, there will be a significant increase in trucking operations through the whole region; Martel estimated about 120,000 trips a year along the Atikokan-Ignace-Thunder Bay corridor. Resolute has called for proposals from the 20 or so established carriers working in the region.

The company plans to move most of the finished product by rail, and to do that will have to build a new siding at Sapawe. The old siding (which has been removed) could handle six cars per day, and the new mill will need to have at least 12 per day. Getting the new 3,400-foot rail spur through design, approval and construction will be a lengthy process; it likely will not be ready once the mill is in full production.

Resolute has started discussions with CN about the possibility of moving the finished lumber to Atikokan and shipping it by rail from here, until the new rail spur is built.

The Sapawe mill is part of a $250 million investment Resolute is making in the region.

Resolute holds Sustainable Forestry Licences (SFLs) on five forests management units in this region: Crossroute (here to Fort Frances), and Dog River-Natawin (Quetico to Thunder Bay), and three more northerly units (English River, Black Spruce and Caribou). Martel said the company estimates the sustainable limit of production for this region is 700 million board feet, but that a number of longer-term issues (the ongoing debate about the proper allowance for caribou habitat, and the breakdown in relations between the company and some its environmental partners in the Boreal Forest Agreement), have led the company to limit its planned production to 565 million board feet.

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