Tag Archives: Mackenzie

Conifex Timber Inc. is reporting a net loss of $2.2 million in its third quarter on sales of $38.2 million.

Current quarter net loss improved by $1.4 million over the previous quarter. Net loss during the current quarter improved by $0.7 million over the third quarter of 2010. Overall operating rates based on current total estimated production capacity were approximately 55% during the second and third quarters of 2011 compared to 21% during the third quarter last year.

Conifex reported current quarter lumber shipments of 115 million board feet which represented an increase of 42% over the previous quarter and 260% over the same quarter last year. The increase in shipment volume was due to higher operating rates and the fulfillment of shipment orders from the previous quarter. Revenue from lumber shipments increased by 54% compared to the previous quarter and by 262% over the same quarter last year. Current quarter average WSPF 2×4 #2 & Btr prices increased by approximately 4% compared to the previous quarter and the same quarter last year once the effect of exchange rate fluctuations between the Canadian and U.S. dollar is removed.

Conifex’s geographic sales profile continued to be dominated by export markets. Approximately 72% of total current quarter shipment volumes and 68% of current year-to-date shipment volumes were to offshore markets, primarily China and Japan, compared to 49% of third quarter shipments and 41% of year-to-date shipments last year. The balance of current year-to-date shipments was split equally between the Canadian and U.S. markets.

Lumber production during the third quarter of 2011 totalled 102 million board feet and was flat compared to the previous quarter and an increase of approximately 258% over the third quarter of 2010. Operating results reflect a modest increase in unit log costs during the current quarter and year-to-date periods, modest improvement in unit cash conversion costs during the current quarter and a more significant decrease in current and year-to-date lumber segment selling, general and administration unit costs.

Conifex and its subsidiaries’ primary business currently includes timber harvesting, reforestation, forest management, sawmilling logs into lumber and wood chips, and value added lumber finishing. Conifex’s lumber products are sold in the United States, Chinese, Canadian and Japanese markets. Upon completion of its bioenergy facility at Mackenzie, British Columbia, Conifex’s business segments will be expanded to include bioenergy.

Conifex’s sawmill complex situated in Fort St. James, British Columbia was purchased in August 2008 and commenced operations on a one-shift basis in March 2009. Conifex’s two-mill complex situated in Mackenzie, British Columbia was purchased in June 2010. One mill at Mackenzie started up on a one-shift basis in November 2010. Conifex added a second shift at Fort St. James and Mackenzie in late March 2011 and is expected to be operating at approximately 70% of capacity by the end of the third quarter of 2011. On a combined basis, Conifex now owns sawmills having an annual lumber production capacity of approximately 745 million board feet on a two-shift basis. The sawmill complexes are supported by renewable forestry licences with an allowable annual cut of approximately 1.6 million cubic metres.

Source: Conifex (read full release)

Conifex Timber Inc. has announced that it has entered into an agreement modifying certain terms of its Electricity Purchase Agreement with BC Hydro from its bioenergy operation in Mackenzie, British Columbia.

The Electricity Purchase Agreement specified a period of 150 days from the date that the agreement was entered into within which acceptance for filing by the British Columbia Utilities Commission was required.

The Amendment Agreement extends this Acceptance Period by 90 days.

The extension was put in place to allow for the completion of the Province’s review of BC Hydro prior to the filing of the Electricity Purchase Agreement with the Commission.

As a result of the filing delay, the project schedule has been impacted. Subject to the Electricity Purchase Agreement being accepted by the Commission as an energy supply contract, the company now expects that delivery of energy under the EPA to BC Hydro will occur in approximately Q2 of 2013.

The bioenergy facility will create approximately 80 jobs during its construction period, and over 20 new jobs upon completion. The feedstock from the bioenergy facility will be sourced from a portion of the residuals and former waste products produced at Conifex’s lumber manufacturing and log harvesting operations. The facility is expected to produce 230 gigawatt hours of net energy a year (or enough to power about 24,000 homes).

Source: Conifex Timber

Read more:
Conifex Adds Time to Mackenzie Bioenergy-Hydro Project (Opinion 250 News)

Conifex Timber Inc. is reporting a net loss of $3.6 million in their second quarter.

EBITDA improved by $0.5 million compared to the previous quarter and $0.1 million compared to the same quarter last year. The company added a second shift at its Fort St. James and Site II Mackenzie operations at the end of March 2011. Overall operating rates based on current total estimated production capacity improved to approximately 55% during the current quarter compared to 34% in the previous quarter and 22% for the same quarter last year.

Current quarter revenue from lumber shipments increased by 18% compared to the previous quarter and reflects a 30% increase in shipment volumes offset by a 12% decline in average unit sales prices. Average WSPF 2×4 #2 & Btr prices adjusted for a 2% appreciation of the Canadian dollar compared to the U.S. dollar declined quarter over quarter by 21%. Conifex achieved higher mill nets in the current quarter than would be indicated by the quarter over quarter decline in benchmark prices due to an improved product and grade mix, a robust order file entering the quarter, and less volatility in prices in export markets compared to the North American market.

Conifex shipped a record 83% of total second quarter shipments to export markets compared to 44% in the previous quarter and 41% in the same quarter last year. The Company’s primary export markets are China and Japan. Shipments to export markets during the first six months of 2011 represented 66% of total shipments compared to 36% for the first six months of 2010.

Current quarter lumber revenue increased by 105% compared to the second quarter of 2010 with most of the increase attributable to higher shipment volumes.

Lumber production during the second quarter of 2011 totalled 102.4 million board feet, an increase of approximately 61% over the previous quarter and 148% over the second quarter of 2010. Unit conversion costs declined by approximately 23% compared to the previous quarter and 8% compared to the same quarter last year. The improvement was largely attributable to increased operating rates during the current quarter.

Conifex’s key priority in the short term continues to be to achieve positive EBITDA from its lumber operations. Management remains focused on improving margins by optimizing value from the fibre harvested and reducing cash conversion costs.

In its bioenergy segment, Conifex is undertaking activities to progress the development of its planned bioenergy facility at its Mackenzie sawmill site. The company previously announced the completion of an Electricity Purchase Agreement and Load Displacement Agreement with BC Hydro in June 2011.

Conifex and its subsidiaries’ primary business currently includes timber harvesting, reforestation, forest management, sawmilling logs into lumber and wood chips, and value added lumber finishing. Conifex’s lumber products are sold in the United States, Chinese, Canadian and Japanese markets. Upon completion of its bioenergy facility at Mackenzie, British Columbia, Conifex’s business segments will be expanded to include bioenergy.

Conifex’s sawmill complex situated in Fort St. James, British Columbia was purchased in August 2008 and commenced operations on a one-shift basis in March 2009. Conifex’s two-mill complex situated in Mackenzie, British Columbia was purchased in June 2010. One mill at Mackenzie started up on a one-shift basis in November 2010. Conifex added a second shift at Fort St. James and Mackenzie in late March 2011 and is expected to be operating at approximately 70% of capacity by the end of the third quarter of 2011. On a combined basis, Conifex now owns sawmills having an annual lumber production capacity of approximately 745 million board feet on a two-shift basis. The sawmill complexes are supported by renewable forestry licences with an allowable annual cut of approximately 1.6 million cubic metres.

Source: Conifex Timber Inc.

Production at Paper Excellence‘s Mackenzie Pulpmill in Mackenzie, British Columbia, has been idled due to structural damage at the mill.

The problem started with a tube leak on a recovery boiler on Wednesday. The situation turned much worse by the afternoon when the first tower in the bleaching plant ruptured.

Mill manager, Doug Van Buskirk, said the tower split near the top and peeled open like a can – the pulp in the 22-metre structure spilled to the floor below, causing substantial damage to the area.

No one was injured, and there are no environmental concerns from the spill because it was contained inside the facility.

The mill employs 225. The employees will continue to report to work for the next few days, and assist with the clean up, while the company awaits a damage report from a engineer.

Paper Excellence reopened this mill last August after it sat idle for 2.5 years. The mill was previously owned by Worthington Mackenzie, and by Pope and Talbot.

Read more:
Major Structural Failure Idles Mackenzie Pulpmill (Opinion 250 News)

Conifex Timber Inc. has announced the appointment of Kevin Horsnell as its Chief Operating Officer.

Mr. Horsnell is a Forestry Graduate from the University of British Columbia and obtained his MBA from Royal Roads University. Mr. Horsnell is also a Registered Professional Forester. His extensive industry experience includes the management of all aspects of woodlands and manufacturing operations at a large interior BC sawmill complex.

Mr. Horsnell’s key responsibilities in his new role at Conifex will be the oversight and continued development of its forestry, manufacturing, and marketing operations at Fort St. James and Mackenzie.

Conifex recently restarted the Site II sawmill at Mackenzie on a one-shift basis and is planning to add a second shift at its Fort St. James facility during the first quarter of 2011.

Source: Conifex Timber Inc.

Conifex Timber restarted its Site II sawmill in Mackenzie, British Columbia on a one-shift basis on November 1, 2010.

The output from this site is estimated to be 110 million board feet on an annual basis. The Site I sawmill at Mackenzie remains idled.

Conifex Timber also has a new Chief Operating Officer (COO). Blair Mayes has been appointed to the newly created role effective November 15, 2010.

Mr. Mayes is a Forestry Graduate from the University of British Columbia and an industry veteran. He has been with Dunkley Lumber Ltd. for almost thirty years, most recently in the capacity of General Manager.

In his role as Conifex’s COO, Mr. Mayes’ main responsibilities will involve the oversight and continued development of its forestry and manufacturing facilities at Fort St. James and Mackenzie. He will also play an important role in industry and community relations for the company.

Source

The Conifex owned sawmill in Mackenzie, British Columbia can resume operations now that a new labour agreement has been ratified with the United Steelworkers Local I-424.

Details of the new agreement include:

• 3 year agreement
• $2.50/hr is deferred by the workers until July 1, 2013
• In 3 years, the payback is triggered and the workers will be paid back their deferred hourly amount of $2.50
• A payback can be triggered earlier if the price of lumber reaches $315 per thousand board feet but no higher than $355 per thousand board feet
• If the price of lumber goes over $355 per thousand board feet, the payout will be $2.60 per hour

The restart date for the sawmill has tentatively been set for November 1, 2010. 60-70 employees will be returning to work.

Conifex purchased this operation from AbitibiBowater in June. The total acquisition included:

• two sawmills
• a planer mill
• a forest licence with an annual allowable cut of approximately 932,500 cubic metres
• a steam/power plant and associated turbine and boiler
• a paper mill (excluding the headbox)

The combined annual production capacity of the sawmills and planer mill are 445 million board feet of lumber on a two shift schedule.

Conifex intends to dispose of the paper mill assets but plans to retain the power generation assets.

Source:
Conifex Mackenzie Ratifies Deal, Sets Start Up Date (Opinion 250 News)

Paper Excellence has restarted the Mackenzie pulp mill putting 270 people back to work in British Columbia.

Paper Excellence, a Dutch company, is a subsidiary of the Asian conglomerate Sinar Mas. Paper Excellence bought the mill out of bankruptcy for $20 million at the end of March and promised to spend $30 million to $40 million on maintenance and upgrades.

This mill was previously owned by Pope and Talbot, followed by Worthington Mackenzie.

Paper Excellence wanted this Mackenzie mill so they could secure a source of northern bleached softwood kraft pulp. 80% of the mill’s output is expected to be sold to affiliated mills in Asia.

Source:
Mackenzie pulp mill restarts, putting 270 back to work (Vancouver Sun)

Howe Sound Pulp and Paper has been sold by its owners (Canfor and Oji Paper Co. Ltd. of Japan) to Paper Excellence B.V.

Paper Excellence B.V. is based in the Netherlands and is associated with one of the world’s largest pulp and paper producers of Asia Pulp and Paper brands.

This is the third Canadian acquisition for Paper Excellence. The company already owns a pulp mill in Meadow Lake, Saskatchewan, and a pulp mill in Mackenzie, British Columbia. When Paper Excellence purchased the idled Mackenzie mill in April, for $20 million, they said they were planning to invest tens of millions before the start of production in the fall.

Paper Excellence also recently purchased two kraft pulp mills in France from Tembec.

“I think this a great thing going forward for HSPP,” said Strang. “At the core of Paper Excellence’s business is pulp and paper. They will be looking at a lot of our products to facilitate their operations. The indication is they have plans to invest in the mill here and increase our overall production. We certainly don’t anticipate any reduction in our work force. In the short-term, it’s business as usual.”

The purchase price for the Howe Sound Pulp and Paper mill is not known, but the deal is expected to close in the third quarter of this year.

The Howe Sound mill, located in Port Mellon, British Columbia, employs about 500 workers and has production capacity of 400,000 tonnes of NBSK pulp and 230,000 tonnes of mechanical paper at the facility, which was first acquired by Canfor in 1951.

Canfor and Oji Paper created the Howe Sound partnership in 1988 in a deal that expanded the plant’s pulp production and added its newsprint mill.

Sources:
Paper Excellence to buy HSPP (Coast Reporter)
Howe Sound pulp mill sold to Dutch firm (Biv Interactive)

AbitibiBowater announced today that its subsidiaries have completed

• (i) the sale of three idle paper mills located in eastern Canada together with certain related assets and the property on which these paper mills are located to a wholly owned affiliate of American Iron & Metal Company Inc. (“AIM”) for C$8.7 million and
• (ii) the sale of assets located in British Columbia to an affiliate of Conifex Inc. (“Conifex”) for C$33.9 million.

The three paper mills sold to AIM are located in:

• Beaupré (Québec)
• Donnacona (Québec)
• Dalhousie (New Brunswick)

As part of the sale, AIM has also agreed to acquire a fourth idle paper mill (Fort William), located in Thunder Bay (Ontario).

In addition, AbitibiBowater will be paid 40% of the net proceeds from any subsequent sale of paper machines from these mills, of which AIM has undertaken to pay C$5 million on September 6, 2010, regardless of whether any such subsequent sale takes place.

The assets sold to Conifex, all located in Mackenzie (British Columbia), include a paper mill, two sawmills, including planer mills, as well as timberland operations with a forestry license providing an annual allowable cut of approximately 932,500 cubic meters.

AbitibiBowater has streamlined its asset portfolio to focus on top-performing facilities by closing or idling 3.4 million metric tons of paper capacity, moving from an overall production capacity of 10.4 million metric tons to 7 million metric tons, since 2007. During this period, the Company has also sold aggregate assets and land for total proceeds of over $980 million.

Source: AbitibiBowater