The Scottish company, Forscot Ltd, is planning a £1bn integrated pulp mill, paper mill and renewable energy plant, together with an independently owned and operated sawmill, at Invergordon in the north-east of Scotland. The operation will use Sitka spruce grown in Scotland and the north of England as its main raw material. Supplies are available, sustainable and plentiful, as well as being forecast to expand in excess of the company’s requirements. As a result, Forscot believes it will be able to offer growers competitive prices and long-term contracts.
The project originated from a study by Scottish Enterprise, which investigated a way of adding value to Scottish Sitka spruce by building a pulp mill. Forscot took this idea and developed it into a fully integrated, world scale pulp, paper and energy plant, which would be cost-effective and profitable.
Forscot intends to set up long-term contracts for its wood supplies with independent growers and the Forestry Commission. Harvested timber will be collected at satellite locations on the coast and inland, from where it will be transported to Invergordon, mainly by sea or rail.
Invergordon was chosen principally because of its good transport links. In addition, the site is designated for industrial development and the area is used to large-scale industrial operations.
Sawmill operation
Space is being allocated on site for a sawmill, which will be owned and operated by an, as yet, un-named leading UK sawn goods manufacturer and is expected to produce around 250,000m3 of strong, low cost construction timber per year for the domestic market. With the increasing demand for timber frame houses, this area of business has good growth potential.
The company will add value to those parts of the trees that are not used by the existing sawmill industry. Sawmill chips from throughout Scotland, together with roundwood that is unsuitable for sawmilling, will be used to make pulp and paper. The ‘non-usable’ wood from the sawmills, the surplus fibre from the harvesting and pulping operations, together with the non-cellulose part of the wood and other materials dissolved during the pulping process, will be burnt as biofuel to power the plant, making it self-sufficient in energy needs.
Heat and electricity sales
Forscot expects to generate some surplus electricity and heat for sale on the open market. All the electricity generated will almost certainly be classified as ‘green’ power, which will be eligible for Renewable Obligations Certificates (ROCs) and will help Scotland meet renewable energy targets.
Most of the market pulp from the venture will be sold to tissue and magazine paper manufacturers in European markets, with some exported to North America. The UK is one of the largest European markets for pulp, but the paper industry imports 75% of its virgin fibre. Currently the Forscot grade of pulp is only produced in Canada.
The paper mill will use the remainder of the market pulp, together with all the mechanical pulp made on site, to produce magazine and advertising papers. Consumption for magazine papers grows by around 3-5% a year and the quality of the Sitka spruce fibre will position Forscot in the top quartile of the market.
The entire plant will have a major focus on environmental issues, with the planning process including a full environmental impact assessment to ensure the site meets or exceeds all EU, national regulatory and legislative requirements.
Forscot has so far carried out a number of feasibility studies and detailed project design work. The company is in discussion with potential trade partners to raise a further £5m-10m, which will be used to secure the site, apply for the necessary planning and environmental permits and appoint a senior management team.
Construction of the plant is planned to start in 2006 and production in 2008. Once in full production, Forscot will employ around 500 people and the company estimates that about 5,000 indirect jobs will be created to provide goods and services.
Forscot chairman Ed Gillespie said: “This is probably the biggest project Scotland has ever seen. Not only will it create a large number of both direct and indirect jobs, but it will also provide a profitable outlet for Scottish Sitka spruce.”
