TECHNO-ECONOMIC ANALYSIS OF BIOREFINERY
PROCESS OPTIONS FOR MECHANICAL PULP MILLS
ABSTRACT
JAWAD JEAIDI, PAUL STUART*
Whereas the chemical pulp sector has received significant attention for its potential for transformation to the forest biorefinery, the case of
integrated newsprint mills incorporating various forms of mechanical pulping has been addressed to a far lesser extent. This is at least in
part because mechanical pulping process yields are much higher than those of chemical pulping, resulting in lower potential for raw material feed to the biorefinery plant. However, the need for transformation in many newsprint mills is critical, especially considering the decline
in newsprint demand over the last decade. The transformation approach for newsprint mills will be distinct from that of chemical pulp mills;
many must consider exiting the newsprint manufacturing business completely as they transform, while some more efficient newsprint mills
will aim to improve their competitive position further by implementing a biorefinery while continuing to manufacture newsprint over the long
term alongside new products. With integrated biorefinery processes, mills will seek both to reinforce their core business and at the same
time to diversify their product portfolios by addressing technological as well as market risks. This paper presents a techno-economic evaluation of three different biorefinery strategies that are appropriate for newsprint mills. Various success metrics are calculated, including overall
capital expenditure and internal rate of return, but also metrics that consider the short-term viability of the retrofitted newsprint mill facility.
Strategic assessment should consider the ability to reduce newsprint manufacturing costs, the ability to implement the biorefinery process
incrementally to mitigate technology risk, and the ability to develop markets for value-added bio-products over the long term.
INTRODUCTION
Since the 1990s, the newsprint sector has
made continuous efforts to lower production costs through improved forest management as well as through mergers and
acquisitions [1]. Despite this, it faces a difficult financial situation today, due in large
part to declining demand, which has halved
over the last decade [2]. Companies are
playing a game of attrition, in some cases
aiming to be the “last man standing”. The
long-term viability of the North American newsprint business remains uncertain,
even given the potential for overseas sales.
The newsprint sector must move quickly
to replace or supplement existing revenue
streams from newsprint with sales of new
products that provide good margins by
building on existing assets.
A proactive strategy has been proposed to save the forestry industry: transformation to the forest biorefinery. The
integrated forest biorefinery concept consists of more fully utilizing the incoming
wood material, including additional forest
residues, to produce bio-fuels and commodity and value-added bio-chemicals
and bio-materials [3]. Even though it in-
62
J-FOR
volves considerable risks, the biorefinery
concept offers serious opportunities for
the forestry sector to diversify its product
portfolio while lowering its production
costs and its environmental footprint [4].
Moreover, the biorefinery is a logical extension of the current core business because mills already have access to woody
biomass.
This paper includes an analysis of
the integration of emerging biorefinery processes into an existing integrated
newsprint mill. A phased implementation
strategy for the forest biorefinery transformation at an integrated newsprint mill
is considered to mitigate technology and
market risks. The objectives of this study
were the following:
• To identify and design step-wise
implementation strategies for the
transformation of mechanical pulping
mills into biorefineries,
• To assess and compare these
strategies on the same techno-economic basis, and
• To identify appropriate assessment metrics for evaluating how a
biorefinery strategy may reinforce the
newsprint business or assist in exiting
the business.
BACKGROUND
Chemical versus mechanical pulp
mill biorefinery transformation
The integration of the forest biorefinery
concept has been studied extensively for
retrofitting chemical pulping mills [1],
PAUL STUART
JAWAD JEAIDI
NSERC Design
NSERC Design
Engineering Chair
Engineering Chair
Department of
Department of
Chemical Engineering
Chemical Engineering
École Polytechnique
École Polytechnique
de Montréal,
de Montréal,
Montréal, QC
Montréal, QC
Canada
Canada
*Contact: [email protected]
Journal of Science & Technology for Forest Products and Processes: VOL.1, NO.3, 2011
SPECIAL BIOREFINERY ISSUE
whereas much less research has been carried out into retrofits of mechanical pulping mills, even if the need for transformation is greater for these mills in light of the
continued decline in newsprint demand.
Chemical pulping mills operate with pulp
yields ranging from 43% to 70%, but typically less than 50% [5]. Various biorefinery processes are being developed for
chemical pulp mills, such as hemicellulose
extraction before pulping (also known as
Value Prior to Pulping (VPP)) [6], black
liquor gasification [7], and lignin precipitation from black liquor [8]. Mechanical
pulping is by definition pulping with minimal delignification. According to Biermann [5], mechanical pulping has yields
between 85% and 97%. Many mechanical pulp mills achieve pulp yields greater
than 95% using state-of-the-art thermomechanical pulping (TMP). Biorefinery
transformation strategies for integrated
newsprint mills are therefore less obvious. Integrated newsprint mills should use
a design approach distinct from that used
for chemical pulp mills, starting with an
assessment of how biorefinery transformation will support the existing newsprint
business. The biorefinery transformation
seems to be able to support either exiting the newsprint manufacturing business
completely or else becoming a more competitive newsprint facility and continuing
to manufacture newsprint on a long-term
basis.
Biorefinery transformation: Strategy
Families
The traditional classification of biorefinery
technologies is based on the principles of
their key unit operations [9][10]: thermochemical processes based on a syngas
platform, and biochemical processes
based on a sugars platform. Another
classification has been introduced by
Ghezzaz [11] based on how completely
the biorefinery processes are integrated
with the pulp and paper (P&P) processes.
Figure 1 represents an extended vision and
shows how a biorefinery can be integrated
in two different manners at an integrated
newsprint mill. The classification depends
on the raw material used and the level
of process integration between the two
facilities, as illustrated. Furthermore,
process and cost integration should be
studied to understand each strategy’s
strengths and weaknesses with regard to
1) business reinforcement and 2) business
shifting. Figure 2 represents all the
departments at an integrated newsprint
mill. The more departments that can be
shared between the existing mill and the
biorefinery facility, the greater the cost
savings that can be expected in the paper
production process.
The strongly integrated forest
biorefinery strategy means that the bioproduct operations are closely coupled
with the production of paper. The degree
of integration can range from medium to
strong depending on how closely existing
departments collaborate. Despite the
large cost integration benefits, the main
disadvantage of this strategy arises from
its limited attainable production volume.
In the case of a mechanical pulp mill,
strongly integrated biorefinery processes
are necessarily fed using a fraction of the
pulp produced or with new streams that
can be shifted from existing processes.
An inspiring concept for a Kraft mill
was proposed by Huang [12], in which
hemicellulose extraction was carried out
before Kraft pulping, followed by pulp
fractionation. The resultant hemicellulose
Fig. 1 - Two types of integration strategy for the biorefinery at an integrated newsprint mill.
J-FOR
sugars and separated short fibres were
used for ethanol production, whereas the
long fibres were used for production of
paper or bio-materials. However, because
of their lignin content, short fibres from
mechanical pulp mills cannot be directly
hydrolyzed and fermented into ethanol or
any other fermentation derivatives without
a prior delignification process. Because
hemicellulose extraction before pulping
affects pulp quality, only low production
volumes of hemicellulose can be obtained
without affecting the main product. This
implies that a commodity product such
as bio-ethanol for the fuel market is not
economically viable, while value-added
chemicals production is a cost-effective
approach. Even if pulp fractionation in a
mechanical pulp mill seems uninteresting
as a way of providing a feedstock for
a sugar-platform process, it remains an
interesting concept for other platforms
such as the production of bio-materials
because mechanical pulping keeps the
lignin in the fibre and offers several
extraction locations. Indeed, at each
mechanical pulp refiner outlet, the pulp
could be separated as described by Huang
[12], and in this way, product pulp quality
could be controlled.
The parallel integrated forest
biorefinery strategy means that the
biorefinery facility operates beside
the papermaking process, but that
the operation of the biorefinery line
is independent. Biomass gasification,
Fig. 2 - Existing mill department and
potential shared utilities and services.
Journal of Science & Technology for Forest Products and Processes: VOL.1, NO.3, 2011
63
pyrolysis, and fractionation are the three
main processes that can be implemented
in parallel with a papermaking line. Process integration in this case occurs to a
much lesser degree or not at all, depending on whether pulpwood is used to feed
the biorefinery plant. Within the existing
infrastructure capacities, capital costs for
the commercial biorefinery can be minimized to a certain extent, bearing in mind
that these processes benefit particularly
from economies of scale. As for operating
costs, the benefits come primarily from
energy integration, sharing of utilities, and
sharing of overhead costs. Nevertheless,
biomass cost has a more critical impact
because the transportation costs to the
mill gate go up while the capital intensity
and the bio-products production cost go
down as biorefinery size increases. Designing the biorefinery plant capacity is
therefore a complex task.
Techno-economic assessment for
biorefinery transformation
Biorefinery investments are difficult to
compare because they can be designed
in many different ways depending on the
biomass type, the processing technology,
the products produced, and the case mill
location. These difficulties arise partly
from the high uncertainty and a scarcity
of information related to the performance
of the various processes. Indeed, biorefinery technologies are numerous, patented,
and currently in development and implemented by small and medium enterprises
(SMEs). These SMEs publish results that
in many cases do not enable direct comparison because of the different assumptions
made in each case. A large-block analysis
(LBA) methodology has been developed
[13] [14] [15] to meet this need to compare
several different retrofit opportunities using the same basis. LBA represents the
process by a series of large blocks, each
characterized by inputs, a model, and outputs. The LBA methodology consists of
establishing a basis of common assumptions by combining public-domain studies
that provide at least theoretical estimates
of bio-product yields, simulations (if
they exist), model-based mass and energy
23
64
J-FOR
balances, and capital investment estimates.
Hytönen has applied the LBA methodology to the case of a bio-fuel production
retrofit at a Kraft mill [14]. However, difficulties arise when considering value-added
products which are not supported by studies addressing balances and costs, unlike
the bio-fuel production process.
Phased approach for risk mitigation
The transformation of P&P mills to
biorefineries involves technology risks in
retrofitting and use of emerging processes
as well as market risks in selling new bioproducts. The successful transformation
of an existing pulp and paper mill might
be achieved using a strategic phased approach taking into account both shortand long-term visions. Chambost et al. [4]
laid the foundation with a three-phase approach for transformation of a P&P mill
into a biorefinery.
Phases I and II involve disruption in
existing processes by integration of biorefinery technologies, and Phase III deals
more with business disruption by changing the way that the company does business. Emphasis is placed on the long-term
targeted product portfolio of the biorefinery. The phased approach is designed
accordingly and should begin by defining
the desired outcome of Phase III; then
the previous phases are designed with the
best effort to mitigate risk. This paper focuses its efforts on Phases I and II where
the technological transformation is carried
out.
Phase I aims to trigger the transformation and to lower paper production
operating costs. The latter is of critical
importance so that the transformation
can compete internally with other capital spending projects. Technological and
market risks together should be as low as
possible in this phase. Selling a new bioproduct is not a requirement; rather, the
value proposition is often the production
of a building-block product which is consumed internally, eliminating all market
risk and reducing internal operating costs.
Ideally, Phase I should create substantial
cost savings to reduce the burden of negative cash flows over the first years of the
investment. Then, at the suitable time,
Phase II investments are made.
Phase II represents the long-term
biorefinery vision of the company. A sustainable product portfolio is established,
and key success factors such as partnerships are selected. Phase II consists of
producing bio-product derivatives for substitution or replacement of fossil-based
products for which the technological and
market risks are higher, but so are the returns. Phase II is designed using product
and process design tools. Market analyses
Fig. 3 - Strategic implementation of the biorefinery by a forest company [4].
Journal of Science & Technology for Forest Products and Processes: VOL.1, NO.3, 2011
SPECIAL BIOREFINERY ISSUE
are of critical importance in this phase.
There is no indication in the literature of whether a biorefinery investment
strategy should favour staying in the paper business or exiting it. However, criteria supporting decision-making for
technology [16] or capital spending [17]
selection, such as percentage decrease in
paper production costs and the ratio of
new revenue sources to overall earnings
before interest, taxes, depreciation, and
amortization (EBITDA), can obviously be
useful in assessing how an investment will
support continuing production or an exit
from the newsprint business. Basically, a
biorefinery strategy which does not significantly decrease paper production costs
would not be recommended if the company aims to become a super-producer,
whereas a biorefinery strategy in which
new bio-product benefits do not compete
with paper benefits would not be recommended for a company aiming to exit the
newsprint business.
MILL CASE STUDY
An existing mechanical pulp mill in Eastern Canada was chosen as a basis for gathering both process and financial data. A
model of a competitive single TMP line,
single paper machine mill producing approximately 700 odmt of newsprint per
day was extrapolated from these data and
simulated in a Microsoft Excel® spreadsheet. De-inking (DIP) was considered as
a traditional process retrofit for comparison with the biorefinery investments.
METHODOLOGY
The methodology should support the
strategic design and the techno-economic
assessment. For evaluating how a biorefinery strategy suits newsprint production,
critical metrics should be identified and
assessed. First, phased strategies are defined with respect to the case study mill,
the available feedstocks, and the potential
surrounding markets for end products.
These strategies are developed in two
investment phases; Phase II represents
the long-term vision for the biorefinery.
Process block diagrams are developed
for each phase. Mass and energy balances
J-FOR
TABLE 1
Strategy
Phase strategies considered.
Phase 1 (P1)
Phase 2 (P2)
VPP
Hemicellulose extraction before TMP for sizing-agent
production
Xylitol production from
xylose
Biocomp
TMP pulp splitting for commodity bio-composite
production
Value-added bio-composite
production
Organosolv
Organosolv pulping and CHP implantation for ethanol
production
PF resin production
for the entire modified mill and for total
capital investment were computed from
block-by-block calculations using an LBAbased approach. Finally, the economic
performance of each strategic investment
opportunity was estimated by calculating
cash flows and capital costs and deriving
metrics. Calculations were performed using an integrated approach combining the
use of Aspen Plus® and Microsoft Excel®.
Strategic phased investment definition
The proposed transformation strategies
should be designed in two phases. The
targeted design should be chosen with a
view to the long-term vision represented
by Phase II, in which revenues are significantly increased by the sale of derivatives. Phase II definitions are supported
by business considerations (e.g., potential
markets, partnerships), whereas Phase I is
designed with a view to mitigating risks.
Phase I represents a carefully planned investment designed to trigger the transformation, while at the same time reinforcing
the core business; energy reduction is often an outcome of such integrations. This
is a cautious approach to ensure shortterm viability. If a new product—a building block for Phase II—is produced in
Phase I, it is evident that the existing and
new production lines will share overhead
costs, reducing paper production costs
even further. Whatever the long-term vision for the biorefinery may be, newsprint
will still be sold in Phases I and II. The
vision for the newsprint business is assumed to be determined separately. These
phased investment strategies are described
in Table 1.
The first strategy consists of producing xylitol, a value-added chemical for the
food and pharmaceutical industries. Xylitol is made by xylose fermentation, and
xyloses can be extracted using VPP. The
small market demand for xylitol is a good
match with the low production volume.
Phase II is represented in Fig. 4 as having the following benefits: decreasing specific energy of refining due to chemical
chip impregnation, and new cash income
from conversion of the extracted hemicelluloses into a value-added green chemical.
This investment involves two major technological risks. First, the oxalic acid (OA)
pre-treatment, if strongly integrated into
the pulp mill, may disrupt the papermaking process (creation of oxalate salts, effects on the quality of the newsprint pulp,
etc.). Second, the upgrading of the liquor,
its further detoxification, and the fermentation of the xyloses into xylitol have not
yet been demonstrated. For risk mitigation
reasons, Phase I was designed to handle
only the first risk described. No new bioproduct sales are planned. As illustrated in
Fig. 5, Phase I aims to implement hemicellulose extraction before the TMP process
and the concentration of the spent liquor
by evaporation. Concentrated hemicelluloses can be added as a sizing agent to
the bulk of the newsprint pulp to improve
paper mechanical properties. This will improve newsprint quality as well as lowering
energy costs. Phase I triggers the transformation into the biorefinery.
The second strategy consists of selling value-added bio-composites. Such biocomposites are attracting more and more
interest in industries like the construction,
automotive, and packaging industries because of their three main competitive advantages: lower costs, improved quality
(higher strength, lower weight), and production from renewable feedstocks. Similar-looking natural wood bio-composites
Journal of Science & Technology for Forest Products and Processes: VOL.1, NO.3, 2011
65
Fig. 4 - Process block flow diagram after Phase II of the VPP strategy.
Fig. 5 - Process block flow diagram after Phase I of the VPP strategy.
Fig. 6 - Process block flow diagram after Phase I of the bio-composites strategy.
Fig. 7 - Process block flow diagram after Phase II of the bio-composites strategy.
23
66
J-FOR
already exist; they are made from less engineered wood fibres, such as wood flour
or medium-density fibre (MDF), which
do not attain the quality and uniformity
of TMP fibres. The proposed concept
includes using a part of the TMP wood
fibres as reinforcement fibres in a plastic
matrix, thus forming a bio-composite material. The Phase II value-added bio-materials will compete in a demanding market
and will require specific properties related
to their application. The automotive market was targeted in Phase II, so the biocomposite materials produced will require
good crash and fire resistance. Crash-resistant materials should be flexible, and
therefore fine fibres are preferred as fillers. Apart from optimizing the filler shape,
choosing the right formulation (polymer
and additive) is of critical importance for
product quality. This high risk could be
mitigated by selecting an appropriate industrial partner at an early stage, an issue
which is not discussed further in this paper. The TMP fibres should be properly
fractionated by size and functionalized so
they can satisfy the product requirements
represented in Fig. 7 by the fibre treatment block. To mitigate the associated
risks, Phase I proposes to produce and sell
a commodity bio-composite in which the
incorporated fibres need only to be dried
before the compounding process. Figures
6 and 7 illustrate the two phases.
The third strategic vision is to produce bio-ethanol and phenol formaldehyde (PF) resins in large volumes. Indeed,
lignin can partially replace phenol in PF
resins. Bio-ethanol is made from cellulose
and hemicellulose sugars. In Phase I, a
lower production capacity is considered.
One benefit of this strategy can be obtained using the existing energy island at
the mill, because Phase II will require an
extra boiler. Hardwood chips are fractionated by organosolv pulping into cellulose
pulp, dissolved lignin, and hemicelluloses.
Figures 8 and 9 show the operating principles for Phases I and II respectively.
Mass and energy balance calculations
Process models were implemented as large
Journal of Science & Technology for Forest Products and Processes: VOL.1, NO.3, 2011
SPECIAL BIOREFINERY ISSUE
blocks (input—model—output) with the
combined use of Aspen Plus® and Microsoft Excel®. The base-case TMP pulping
and papermaking processes were represented in a spreadsheet model with high
granularity for the pulping process, where
strongly integrated strategies will be used.
Energy and mass balances were developed
using Visual Basic® modules for representing the process on a first-principles
basis. The input data were taken from an
approximately steady-state regime identified in the existing base-case mill during
the winter. The biorefinery processes were
partially added as large blocks to the basecase model and partially represented in
Aspen Plus®, especially the distillations.
Published laboratory-scale results for the
assumed value-added bio-products were
used as inputs to the mass and energy
calculations. The focus was on heat, electricity, purified water, and waste-water balances to define whether the case study mill
capacities would be sufficient to supply the
demand or whether new systems would be
needed and if so, at which size.
Fig. 8 - Process block flow diagram after Phase I of the organosolv strategy.
Costs assessment and economics
Total capital investment (TCI) costs were
developed for direct and indirect costs. Direct costs were estimated using the capitalcost scaling formula (Eq. 1) for evaluating
the equipment costs in each process area:
where Cs and Cr are the scaled cost and
the reference cost respectively; Ss and Ss
are the scaled size and the reference size
respectively; and f is the capital-cost scaling factor. The exponent varies from 0.60
to 0.92 depending on the equipment.
The references are taken from sources
reviewed and vendor quotations for mature technologies. Capital costs for emerging technologies were evaluated based
on comparison with similar mature technologies assuming critical parameters.
For instance, in the fermentation department, the capital cost for ethanol batch
J-FOR
Fig. 9 - Process block flow diagram after Phase II of the organosolv strategy.
fermentation is that of the mature reference process. The critical parameter is the
fermentation yield; the ratio between the
targeted product and ethanol was included
to account for the need for an extra fermenter.
Operating costs were developed as
both variable and fixed costs. Inputs were
financial data from the mill, mass and energy balances, and economic assumptions
(Table 2).
An Excel economic model was used
to model and compute the expected mill
cash flows over the next 20 years. No
time horizon was assumed for the investments by phase. Phase I was studied as a
single investment project for 20 years. As
well, the Phase I and II investments were
considered as a single investment studied
alone for 20 years.
Further traditional economic metrics
can be calculated, such as earnings before
interest, taxes, depreciation, and amortization (EBITDA), which expresses the difference between income and expenses.
This is a popular metric because it is not
influenced by TCI and represents whether or not the company is making money.
In Fig. 12, the EBITDA of the company
under evaluation has been normalized by
that of the same company without any investment. This was done both for confidentiality reasons and to provide a better
representation of the impact in percentage terms.
The net present value (NPV) represents the sum of discounted cash
flows over the 20 years, including the
TCI. The result depends on the selected discount rate, which is highly
Journal of Science & Technology for Forest Products and Processes: VOL.1, NO.3, 2011
67
Fig. 10 - Total capital investment for the biorefinery
strategies considered.
project-specific. For this reason, another
metric is preferred, the internal rate of return (IRR) defined as the specific discount
rate that makes the NPV equal to zero:
Fig. 11 - Internal rate of return for the biorefinery strategies considered.
negative if the investment has not been
paid back over the 20 years of the project
life. Even with few biorefinery opportunities, transformation for mechanical pulp
mills looks promising when viewed from
TABLE 2
where TCI represents the total capital
investment; t the project lifetime; Rt the
net cash flow at time t; and i the discount
rate.
RESULTS AND DISCUSSION
It is important to note that each mill exists in a unique context linked to its unique
market opportunities and that results are
mill-specific in every case.
Figure 10 illustrates the TCI for the
four investment plans. The organosolv
process, which is implemented in parallel,
has the highest TCI. The strongly integrated forest biorefinery TCIs (Fig. 10) are
lower than that for the parallel process and
even lower than that of the DIP implementation at the mill.
Figure 11 illustrates the IRR of
the four strategies for each phase: on
the one hand, for Phase I alone over 20
years, and on the other hand, for jumping directly to Phase II. For all strategies, Phase II is more profitable than
Phase I because of value-added product sales, economies of scale, or both.
Phase I may have an IRR that is almost
23
68
J-FOR
a perspective beyond the long-term Phase
2 IRRs (Fig. 8). Nonetheless, even with
a carefully phased approach, short-term
Phase I profitability will miss the target.
Figure 12 illustrates the overall
Main economic assumptions.
Economic assessment variables
Tax
30% (when income positive)
Investment
100% paid in 2012
Depreciation
Linear over 20 years
Inflation factor
Start up
0%
Incentives and subsidies
2013 (75% production), 20142033
(100% production)
No product subsidies
No investment incentives
Biomass materials costs
• Pulpwood
• Hardwood
• Old paper
Product selling prices
• Newsprint
• Xylitol
• Bioethanol
• PF resin
• Commodity Biocomposite
• Added-Value Biocomposite
Journal of Science & Technology for Forest Products and Processes: VOL.1, NO.3, 2011
160 $/t
110 $/t
90 $/t
600 $/odmt
8000 $/t
2.15 $/Gallon
2200 $/t
1400 $/t
2200 $/t
SPECIAL BIOREFINERY ISSUE
Fig. 12- Normalized company EBITDA for the biorefinery strategies
considered.
company EBITDA normalized by today’s
value in the case study mill. EBITDA provides an appropriate measure of how profitable the modified company would be.
Figure 13 depicts the portion of revenue from new products for the four strategies for each phase. This metric gives an
idea of how dependent the modified company will be on newsprint market risk. The
organosolv parallel process seems to suit
an exit strategy from the newsprint business because it provides substantial revenue diversification. On the other hand,
strongly integrated biorefinery processes
provide less revenue diversification and
therefore fit in better with a strategy to
stay in the newsprint business.
CONCLUSIONS
Even if mechanical pulp mills apparently offer less opportunity for transformation into biorefineries than chemical
pulp mills, three biorefinery strategies at
an integrated newsprint mill have been
evaluated. Whether or not there is a future
stabilized demand for newsprint, such
evaluation will be of critical importance
for determining whether any of the toptier mills will survive. The best newsprint
mills need biorefinery transformation to
ensure their super-competitor positions,
whereas other mills may implement the
biorefinery to diversify and shift their
business model away from newsprint
manufacture. Investing in the transformation to a biorefinery involves managing risk. This paper has aimed to express
J-FOR
Fig. 13- Revenue diversification for the biorefinery strategies
considered.
in concrete terms what could be a biorefinery transformation for mechanical pulp
mills. Using a phased approach to mitigate
risks, three biorefinery strategies were designed. Then the investment techno-economics as well as the financial health of
the company were studied for each investment phase, both short-term and longterm. IRR metrics describe the investment
results, while EBITDA metrics indicate
the company’s viability. Long-term IRRs
look promising because their related values range between 20% and 47%. Longterm EBITDAs confirm the upper value.
However, short-term profitability and
company viability miss the target, providing worse results than a de-inking retrofit
with IRRs between 1% and 7% and marginal EBITDA. The biggest investment is
for the parallel biorefinery, which provides
the best return and the best revenue diversification. Other strategies are less capitalintensive and involve a greater degree of
integration with the mill.
REFERENCES
1.
2.
3.
4.
5.
6.
ACKNOWLEDGEMENTS
This work was supported by the Natural
Sciences and Engineering Research Council of Canada (NSERC) Environmental
Design Engineering Chair in the Chemical
Engineering Department of École Polytechnique de Montréal. The authors would
like to thank the participating mill for their
ongoing assistance throughout the project
and colleagues Jose Melendez and Milan
Korbel at the NSERC design chair for
their contribution to this paper.
7.
8.
Wising, U. and Stuart, P., “Identifying the Canadian Forest Biorefinery,”
Pulp and Paper Canada 107(6): T128133 (2006).
Corbeil, M., “Pâtes et papiers: statistique coup de poing”, Le Soleil
(2010).
Amidon, T.E., Wood, C.D., Shupe,
A.M., Wang, Y., Graves, M., and Liu,
S., “Biorefinery: Conversion of Woody
Biomass to Chemicals, Energy, and
Materials”, Journal of Biobased Materials and Bioenergy 2(2): 100–120
(2008).
Chambost, V., McNutt, J., and Stuart,
P., “Guided Tour: Implementing the
Forest Biorefinery (FBR) at Existing
Pulp and Paper Mills,” Pulp and Paper
Canada 109(7/8): 19-27 (2008).
Biermann, C.J., Handbook of Pulping
and Papermaking, 2nd ed. Academic
Press, 1996.
Jameel, H., Phillips, R., Chang, H.M.,
and Jin, Y., “Production of Ethanol
from Lignocellulosic Biomass Using
Green Liquor Pretreatment,” U.S. Patent No.2011/0314726 A1 (December
2011).
Larson, E.D., Consonni, S., Katofsky, R.E., Burlington, I., Lisa, K., and
Frederick, W.J. Jr, “A Cost-Benefit
Assessment of Gasification-Based
Biorefining in the Kraft Pulp and
Paper Industry: Volume 1, Main Report,” Princeton University, Princeton
NJ, 2006.
Öhman, F., Precipitation and Separa-
Journal of Science & Technology for Forest Products and Processes: VOL.1, NO.3, 2011
69
9.
10.
11.
tion of Lignin from Kraft Black Liquor. Ph.D. thesis, Department of
Chemical Engineering and Environmental Science, Chalmers University
of Technology, Gothenburg, Sweden
(2006).
Thorp, B., “The Verdict Is In: Biofuels Boom,” in Proceedings, Society of
American Foresters Annual Meeting,
Oregon Convention Center, Portland,
Oregon, 2007.
Thorp, B., Thorp, B.A. IV, and Murdock-Thorp, L.D., “A Compelling
Case for Integrated Biorefineries, Part
II,” Paper360o: 20-22 (April 2008).
Ghezzaz, H., “Méthode systématique de conception pour comparer
les procédés de bioraffinage intégrés
dans une usine existante de pâtes
et papiers,” Master’s thesis, Department of Chemical Engineering, Ecole
www.paptac.ca
12.
13.
14.
Polytechnique de Montreal, Montreal,
Canada (2011).
Huang, H.J., Ramaswamy, S., Al-Dajani, W.W., and Tschirner, U., “Process Modeling and Analysis of Pulp
Mill-Based Integrated Biorefinery
with Hemicellulose Pre-Extraction
for Ethanol Production: A Comparative Study,” BioresourceTechnology
101(2): 624–631 (2010).
Janssen, M., Cornejo, F., Riemer, K.,
Lavallée, H., and Stuart, P., “TechnoEconomic Considerations for DIP
Production Increase and Implementation of Cogeneration at an Integrated
Newsprint Mill,” Pulp and Paper Canada 107(9), T184-T188 (2006).
Hytönen, E. and Stuart, P., “Integrating Bioethanol Production into an
Integrated Kraft Pulp and Paper Mill:
Techno-Economic Assessment,” Pulp
15.
16.
17.
and Paper Canada 110(5): T58-T65
(2009).
Ghezzaz, H. and Stuart, P., “Biomass
Availability and Process Selection for
an Integrated Forest Biorefinery,”
Pulp and Paper Canada 112(3): 19
(2011).
Cohen, J., Janssen, M., Chambost, V.,
and Stuart, P., “Critical Analysis of
Emerging Forest Biorefinery (FBR)
Technologies for Ethanol Production,” Pulp and Paper Canada 111(3):
T42-T48 (2010).
Hytönen, E., “Methodology for Identifying Promising Retrofit Integrated
Forest Biorefinery Strategies—Design
Decision Making Under Uncertainty,”
Ph.D. thesis, Department of Chemical Engineering, Ecole Polytechnique
de Montreal (2011).
WHY JOIN PAPTAC’s
TECHNICAL COMMUNITIES
Sharing information on specific topics & challenges facing the Canadian pulp and
paper industry.
Accessing an exclusive Canadian technical pulp and paper network.
Continuing to learn from your peers, identifying and developping new problem-solving solutions.
Being aware of the latest technological advancements and innovations.
Greater value derived from participating in PAPTAC events (PaperWeek, PACWEST, conferences,
webinars, etc.).
The technical communities have been formed among PAPTAC members who are interested in a particular
aspect of the industry. Members discuss practical and scientific developments in their area of specialty. They
work on projects to learn more about the industry, and then disseminate this information to the industry
through technical presentations and reports.
For more information regarding PAPTAC's technical communities or to join as a member of a community
(PAPTAC membership required), contact PAPTAC (514-392-0265 / [email protected]).
PAPTAC NEWS
23
70
J-FOR
Journal of Science & Technology for Forest Products and Processes: VOL.1, NO.3, 2011