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Oulun Energia expanding Laanila operations

Oulun Energia expanding Laanila operations
An artist's rendering of the Junnikkala Oulu sawmill currently under construction (image courtesy Junnikkala).

In Finland, municipal energy utility company Oulun Energia Oy has announced that it has signed a cooperation agreement with Junnikkala Oy. The new Junnikkala sawmill, currently under construction in the Laanila industrial park area in Oulu and slated to be operational by the end of 2023, will have a significant impact on Oulun Energia from the perspectives of the development of Laanila area and carbon neutrality.

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In June 2021, Junnikkala Oy, one of the largest independent family-owned sawmill companies in Northern Finland, announced that it was investing EUR 70 million in a new state-of-the-art softwood sawmill in the Laanila area in Oulu, and that would be operational by the end of 2023.

Currently, Junnikkala has two sawmills in Northern Finland, located in Kalajoki and Oulainen respectively.

The new sawmill in Oulu will make Junnikkala an even stronger company in the market that needs to be able to meet the demand of the carbon-neutral construction challenge. The new sawmill in the capital of Northern Finland will support our sustainable growth strategy, and we are building for the future in the long haul. The latest sawmill innovations will be applied in our new unit which will ensure that we can make use of the high-quality raw material to its maximum, said Kalle Junnikkala, CEO of Junnikkala in June 2021.

Almost double the production capacity

The production capacity of the new sawmill will be 300,000 m³ of sawn wood per year. The new sawmill will process 700,000 m³ of sawlogs annually, 80 percent of which will be redwood (Scots pine – Pinus sylvestris) and the rest being whitewood (Norway spruce – Picea abies).

With the investment, the largest single undertaking in the company’s history, Junnikkala will almost double its current production capacity to up to 650,000 m³ sawn wood per annum which means procuring 1.4 million m3 of sawlogs annually making it one of the largest sawmill companies in Finland.

Up to 90 percent of the production of the new Oulu sawmill will be exported from the Port of Oulu to 50 different countries all over the world.

Leveraging synergies

The modern sawmill will be able to process logs in all sizes and the enclosed sawing process minimizes the internal traffic at the facility.

The location of the sawmill creates great logistic synergies in receiving the material, delivering the by-products for energy production, and the transportation of the timber products.

This reduces material handling emissions and brings renewable, more sustainable options for a circular economy.

Oulun Energia’s strategic goal is to develop the Laanila area into an attractive destination for its partners in need of clean and competitive energy.

This agreement is a step towards the strategic aim of the big picture, where Oulun Energia serves current and new industry partners diversly.

Collaborate on fuel and heat

At the moment, a biomass-fired combined heat and power (CHP) plant that generates energy, district heating, and process steam in an energy-efficient manner and an eco power plant that processes non-recyclable waste into steam and heat form the basis of Oulun Energia’s operations in Laanila.

This new cooperation agreement guarantees the distribution of heating energy to the Junnikkala sawmill dry kilns from Oulun Energia’s CHP plant.

At the same time, Oulun Energia and Junnikkala have agreed on extensive collaboration in the acquisition, supply, and use of renewable wood energy.

Junnikkala’s sawmill and sawlog procurement organization generates renewable bioenergy beyond their own needs and plays a part in enabling Oulun Energia to replace peat with renewable side streams in electricity and heat generation.

The procurement and processing of around 700,000 m3 of sawlogs or about 13,000 truckloads annually, generates various logging residues, wood process by-products, and residues suitable for energy use.

These correspond to approximately 15 percent of Oulun Energia’s annual fuel demand.

We are very happy to be able to do our part in contributing to the arrival of the Junnikkala sawmill in Oulu. Thanks to this cooperation, we are taking a big leap together towards a sustainable carbon-neutral future, said Pertti Vanhala, business director at Oulun Energia.

The increase in sawn timber production promotes mid-term carbon sequestration in wood products, as the carbon in wood used in building construction is bound in the buildings for decades to come.

Fuel acquisition of domestic woody biomass provides employment in the region and improves the security of supply.

The new sawmill complex will be the most modern in the world and it opens up new opportunities to develop the synergy between the energy company and the sawmill company. At the same time, we are working together to promote measures to combat climate change, bringing work and well-being to the region, and improving the security of supply, Pertti Vanhala and Kalle Junnikkala agree.

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