In Canada, wood pellet producers Skeena Sawmills Ltd. and Pacific BioEnergy Corporation (PacBio) have entered into a long term off-take agreement for wood pellets. Under the terms of the agreement, PacBio will purchase all of the pellets produced at Skeena Sawmills’ new, state-of-the-art pellet plant, in support of PacBio’s long term supply agreements with power producers in Japan.
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Skeena’s pellet plant is built adjacent to its sawmill in Terrace, British Columbia (BC), and will commence production in Q1 2019. Using sawmill residues, the plant will have an initial annual capacity of 75 000 tonnes with the option to increase to 90 000 tonnes per annum.
Skeena’s pellet plant provides a critical outlet for residual fibre from the sawmill and builds on our commitment to maximizing value from the forest resource and generating local jobs from local logs in Northwestern British Columbia. Our (CA)$20 million investment to build a pellet plant, combined with this long-term strategic partnership with PacBio to serve international markets for bioenergy, supports the sustainability of both our business model and the regional forest economy, said Rick Harris, Vice President of Sales and Marketing for Skeena Sawmills.
Commenting on the agreement, John Stirling, President of PacBio said that the agreement with Skeena Sawmills “contributes to our growing presence serving Japan’s demand for bioenergy products and advances our vision of bringing greater value to B.C.’s forest industry. I want to thank Paul Kalil, PacBio’s VP of Corporate Development, and Rick for leading the development of this Agreement. We look forward to further developing our relationship with Skeena.”
In January 2019, PacBio announced that it had entered into two new long-term pellet supply contracts with Japanese power producers, commencing in 2020 and 2022 respectively.