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SASKATCHEWAN FORESTRY EXPO OFFICIAL SHOW GUIDE

OSB Plant Gets Go-Ahead 

Tolko and First Nations groups to build $200-million OSB mill. 

By Tony Kryzanowski

The past three years have witnessed a number of forestry-related projects getting the go-ahead or being announced.

In late-June, the Saskatchewan forest industry received some much welcome news with the announcement by Premier Lorne Calvert of a $200-million OSB project for the northwest region of the province. A partnership including Tolko Industries Ltd, Meadow Lake Tribal Council (MLTC), Northwest Communities Wood Products Ltd (NWC) and Crown Investments Corporation (CIC) is expected to spend the next few months determining the most suitable site for the OSB plant, to be built near Meadow Lake. 

Construction is expected to begin in the spring of 2002. Through this unique partnership, linking established forest companies, First Nations and northern community businesses and government, Tolko Industries will have 75 per cent ownership of the mill, with MLTC, NWC and CIC owning the remainder. Tolko will be the operating partner. The past three years have witnessed a number of forestry-related projects getting the go-ahead or being announced. 

The new Meadow Lake OSB mill follows closely on the heels of a recently commissioned $180- million OSB plant owned by Weyerhaeuser in Hudson Bay, recent completion of the $90-million Weyerhaeuser sawmill expansion in Big River and the completion of the $22.5-million Wapawekka sawmill in Prince Albert. This last mill is a joint venture between Weyerhaeuser and three First Nations groups. 

Several other viable sawmill projects are at various planning stages and are expected to proceed within the next five years. Another positive outcome of the reallocation of timber resources based on the "use it or lose it" policy favoured by the provincial government is growth among smaller sawmill operators. As a result of the approximately one million hectares that Weyerhaeuser voluntarily returned for reallocation to the province three years ago, the amount of timber distributed among smaller operators in north-central Saskatchewan grew from 85,000 cubic metres of softwood to about 170,000 cubic metres. 

That fibre has now been reallocated, with 10 smaller operators realizing a substantial benefit. Much of the spotlight is shining on Weyerhaeuser in north central Saskatchewan because of the amount of timber the company has turned back to the province in this region, its capital investment in sawmill construction and expansion, as well as the $315- million it is spending to improve the quality of air emissions from its pulp and paper complex near Prince Albert. But the province has undertaken a similar evaluation of timber resources east and west of Prince Albert. 

Investigation and reallocation of timber resources in the Pasquia Porcupine Hudson Bay region east of Prince Albert has also resulted in substantially more timber being made available to smaller sawmill owners. The government is currently in the process of evaluating proposals from operators to determine exactly how the timber will be redistributed. In addition to spurring another OSB plant, the Weyerhaeuser reallocation attracted new players into Saskatchewan forestry. Most of the newly-acquired Crown timber was divided among three enterprises. These were the Mee-Toos partnership, the Lac La Ronge First Nation and Zelensky Bros partnership, and the Northwest Communities Wood Products partnership, which consists of five northwest Métis communities. 

The Meadow Lake OSB plant is expected to deliver a regional economic development response. The Northwest Communities Wood Products partnership in particular stands to benefit significantly from the Meadow Lake decision. Consisting of the communities of Beauval, Green Lake, Patuanak, Pinehouse and Ile-a-la-Crosse, the partnership is planning a sawmill and optimizer for Beauval. To date, they have been gathering information on the available wood supply and seeking a suitable industrial partner. 

Mee-Toos Forest Products is a limited partnership between Peter Ballantyne Cree Nation and BC-based Ainsworth Lumber. The first phase of a $45-million forestry development calls for a new sawmill near Limestone Lake. The government has approved its five-year operating plan and Environmental Impact Statement and is now finalizing the terms of their five-year Term Supply Licence. 

This will allow the company to harvest up to 1.5 million cubic metres of primarily softwood over the next five years. The Lac La Ronge Indian Band/Zelensky Bros partnership is developing a business plan to build a sawmill and remanufacturing facilities in Lac La Ronge and are also in the process of selecting an industrial partner for the project. British Columbia's Carrier Lumber is another new player in Saskatchewan's forest industry, having established one of its renowned large, mobile stud mills near Prince Albert. 

Until recently, the company depended solely on salvaging burned wood in the province, but has since made it known to the Saskatchewan government that it would like to acquire a green timber allocation if one became available. The company has since partnered with the James Smith Cree Nation, which owns a conditional allocation of available wood in the Fort-a-la-Corne Provincial Forest east of Prince Albert. 

A land use planning process currently under way must be completed before sustainable allocations can be finalized. Finally, so many new sawmills will generate more chips than current pulp producers can absorb. There is considerable corporate interest in developing another pulp mill, medium density fibreboard plant or newsprint facility to utilize the surplus chips.

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