Planned Biofuel & Lumber Facility Would be Boon for Newfoundland

The Canadian forest products industry continues to develop cooperative partnerships to maximize the use of wood raw materials while expanding the biobased product offerings from the forest. As we noted last summer, FPInnovations and Resolute Forest Products announced a planned joint venture to manufacture biobased products (sugar stream C5, C6 and h-lignan) at Resolute’s Thunder Bay pulp and paper mill. Such relationships will be important for profitability as the industry continues to consolidate in many sectors. Forward-thinking forest organizations are innovating to take advantage of these new opportunities, as the expansion of biobased products will represent a significant portion of the forest products industry of the future.

Per a recent Canadian Broadcasting Corporation (CBC) announcement out of Newfoundland, a CAD$185-million biofuel (and co-products) facility in Botwood is one step closer to becoming a reality. NewGreen Technology Inc. will be leading the project, which—if the project goes as planned—will soon be offered a tentative deal by Newfoundland and Labrador's provincial government for the allocation of wood fibers on crown lands.

NewGreen Technology was formed in 2015 as a partnership between Jeff Penney, who has 20+ years of forestry experience, Jim Hughes, who comes from a banking and finance background, and Peter Steele, who is the son of Harry Steele, owner of Newfoundland Capital Corporation and nearly 100 radio stations across Canada.

The new project is ambitious and aims to utilize wood raw materials at every step of the way in what will be a three-pronged manufacturing process. The plan will include a sawmill producing 20 million board feet of lumber annually, a biofuel plant manufacturing a form of clean diesel from the sawmill's residues and a project that will revitalize Botwood’s shipping port for exporting products. Current plans are for the biofuel to be shipped to European markets where it will be blended with fossil fuel to meet clean energy standards.

Proposed project in Botwood would include sawmill, biofuel plant and expanded shipping port. (Source: Google Maps & CBC)

The project would provide between 400 - 600 jobs during the construction phase, and roughly 150 permanent positions once the facilities are operational (according to NewGreen’s preliminary estimates). The next step for the project hinges upon approval from the Minister of Fisheries, Forestry and Agrifoods, Steve Crocker, who said he was confident that the department would give NewGreen Technology the green light to move forward. "As for the fiber that the company requires, I'm quite confident as a province we are able to supply that fiber,” he said.

Crocker also said his department is responsible for ensuring there is enough available wood fiber to supply the project. The facility will rely heavily on the former Abitibi Bowater (now Resolute Forest Products) timber stand, which contains roughly 280,000 cubic meters of wood. "We have to make sure our forest management plans match with a commitment of 20, maybe 40 years,” Crocker said. "So we [have to] identify that fiber and make sure that we have a consistent supply."

The next step will be a review of the business plan by the Department of Business, Tourism, Culture and Rural Development. Local residents and officials are hopeful that the province doesn’t drag its feet on the decision-making process, or drive NewGreen to seek out another site. Mayor Barry Manuel of nearby Grand Falls-Windsor, stated that “The creation of jobs, in this economic time, with unemployment on the rise and difficult times for everybody really, when an opportunity comes across like this, you cannot let it pass.”