Forestry Industry moves toward bio-age

Canada’s battered forest industry continues to struggle with sluggish demand, pricing pressures from competitors in developing countries, bankruptcies, plant closures and job losses across the country.

Still reeling from continuous setbacks over the past five years—such as a drawn out softwood lumber dispute with the US—the sector is in dire need of a solutions in order to return to stability and maintain and support its workforce of 270,000.

In search of a long-term solution to revitalize the industry, the Forest Products Association of Canada (FPAC) commissioned a year long-study—The Bio-pathways Project—that revealed forestry companies can capitalize on the bio-age by integrating bio-energy production with existing operations.

“It’s really about the transformation of the sector,” says Catherine Cobden, FPAC’s vice-president of economics and regulatory affairs.

The study, headed by Don Roberts, managing director of CIBC world markets in Ottawa, pulled together more than 60 industry experts, executives and governments to assess 27 traditional and emerging bio-chemical and bio energy technologies on an economic, social and environmental level.

What they discovered was that forest product producers need to look no further than their existing operations. By integrating biotechnology, forestry companies can convert biomass (wood fiber) into bio-energy and bio-chemicals while producing traditional products.

“There are some segments that are always going to be profitable. Lumber is the most obvious one. It will be cyclical in nature, but at the end of the day it will be profitable,” says Cobden, who admits much of the pulp and paper segment needs transformation.

Pulp mills have the most significant opportunities in the bio chemical field because they are more chemical based, but to take advantage of them, saw mills and pulp mills need to work together.

“In the past the pulp mill looked at the saw mill as a provider. This has to change to a partner concept,” says Pierre Lapointe, president and CEO of Quebec-based FPInnovations, Canada’s largest forestry sector research organization and the provider of potential technologies studied in the Bio-pathways Project.

Traditionally, saw mills would burn residual waste to generate energy.

With an integrated bio system in place, Lapointe says they can produce hardwood, two by fours and other wood products, while using the residual waste such as the tops of trees, bark and stumps, as the feedstock for a bio-product.

And pulp mills can continue to produce paper, but they can also extract some of the cellulose, hemicelluloses and lignin at the end of the pulping process.

Cellulose is used to make bio-chemicals and hemicelluloses produce polymer and ethanol.

“If you can replace polymer with hemicelluloses you are reducing your hydrocarbon usage within plastics and you end up with a greener product,” says Lapointe. 

One of the technologies studied—which had the highest return on capital employed (ROCE) at more than 20%—was a pyrolysis system developed by Ottawa-based Ensyn Technologies Inc.

Ensyn’s rapid thermal process (RFP) pyrolysis technology converts biomass into a liquid in less than two seconds.

“It can process pretty much any type of biomass. Certain types perform better than others, but wood works really well,” says Randall Goodfellow, senior vice-president of Ensyn’s corporate relations. “It also processes agricultural biomass and materials from construction demolition.”

When biomass is put into the RTP vessel, it’s rapidly heated to 500 degrees C by a tornado of hot sand, and then quickly cooled. This creates a high yield of liquid bio-oil from the residual biomass.

“This piece of equipment is mostly focused on running on residual materials such as sawdust and bark,” says Goodfellow. “From a company perspective those are materials that they are often trying to find a better higher use for.”

And according to Goodfellow, anybody that is versed in the forestry sector and forestry products manufacturing can use this equipment.

FPInnovations has developed a new technology that produces nanocrystalline cellulose (NCC), which may become an alterative to nano-carbon tubes used in the automotive and aerospace industry.

Within a tree, the cellulose is a long linear molecule packed closely together creating a strong chemical bond and forming crystalline regions, which are very resistant to pulping chemicals. But this strength is also what makes it possible to prepare pulp, which would otherwise turn into syrup.

“We are doing research with a helicopter company to introduce NCCs in their rotors,” says Lapointe. “It’s a totally new field. Imagine using [trees] in aerospace manufacturing.”

FPInnoations is currently working with Canadian company to set up a $40-million pre-commercial NCC demonstration plant.

A full commercial plant will cost somewhere between $150 million and $250 million.

Where the already cash-strapped forest industry would get this kind of money is one the biggest challenges.

“The challenge is not going to be the willingness to change,” says Lapointe. “It’s that there is no capital money available at this point.”

Armed with the study results, FPAC is calling on the federal government for help, asking for $300 million per year over the next three to five years.

FPAC isn’t necessarily just asking for a handout. Cobden says the $300 million could come from changing existing programs. FPAC is asking governments to develop a Made-In Canada clean energy action plan to help advance the development of Canadian technology; create a repayable, revolving fund for capital investments; and leverage the tax system to create capital investment tax credits to keep up with incentives offered in the US and abroad.

For the longer print version of this article see the March 2010 issue of Canadian PLANT WEST.