Report on Cosmopolis Mill - School of Environmental and Forest ...

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LDN, 711 112006 Executive Summary Findines The Cosmopolis pulpmill represents an attractive strategic investment opportunity, most likely for a company committed to serving the rapidly growing Asian viscose and acetate markets. The mill is a supplier of high quality acetate pulps to large, demanding Asian acetate customers like Daicel, it is located in an area where it has transportation wst advantages to large volumes of acceptable quality residual and whole tree wood chips, it operates in compliance with currently-applicable environmental regulations (and seems well-equipped to handle likely new regulations), the mill is relatively automated and in a generally good state of repair and it is advantageously located to economically serve the fastest growing dissolving pulp markets in Asia. Concerns The largest single concern that we have is timing- will we have enough time to find a qualified buyer before Weyerhaeuser makes the decision to curtail mill operations The Cosmopolis mill is a very complicated and specialized, relatively low yielding (pulp volume out versus wood volume in) pulpmill that currently serves a highly differentiated, global market- the market for acetate tow and fiber. The market for acetate pulp is very good right now and established competitors, around the world, are busy strengthening their relative competitive positions. While the Cosmopolis mill is a highly-respected, proven supplier of these very technically-demanding acetate pulps, it is known to have high pulp production wsts versus the newer, larger scale, prehydrolized kr& mills, especially those like Bacel's new mill in the Southern Hemisphere. Furthermore, a previously idled mill with a similar (albeit, less capable) process, the Port Alice 'Neucel' mill on the north end of Vancouver Island in British Columbia, is reportedly in the midst of a $C100 million renovation to enhance its ability to wmpete directly for Cosmopolis' valuable acetate customers. Cosmopolis Pulpmill Project Page No. 1
LDN, 711 112006 Oovortunities The global markets for dissolving pulp products like acetate seem to be growing again and they are moving to Asia. The costs of U.S. surface transportation are climbing rapidly. These seemingly unrelated trends will likely serve to enhance the relative competitive position of the Cosmopolis mill in the future. There also appear to be opportunities to improve the mill's fiber cost, chemicals cost, energy cost and yield. Two current mill by-products, red liquor that is currently burned for energy recovery and alkaline extraction liquor (which is currently a mill disposal problem), are potentially significant sources of incremental revenue. Based upon a preliminary analysis, our team has concluded that it may be economically feasible to convert the mill's red liquor to ethanol and to convert the mill's alkaline liquor to a PF resin. Cosmopolis Pulpmill Project Page No.2
Page 1 and 2: Weyerhaeuser's Cosmopolis Dissolvin
Page 3: EXECUTIVE SUMMARY
Page 7 and 8: LDN, 7/5/2006 Summary Marketing Opp
Page 9 and 10: LDN, 7/5/2006 'The decline in both
Page 11 and 12: LDN, 7/5/2006 surviving mill just c
Page 13 and 14: LDN, 7/5/2006 We estimate that the
Page 15 and 16: LDN, 7/5/2006 Oatimistic Case Key A
Page 17 and 18: LDN, 7/5/2006 Ethers-2%CIF Gross Vi
Page 19 and 20: LDN, 7/5/2006 3) Rhodi Germany has
Page 21 and 22: LDN, 7/5/2006 As noted, the capacit
Page 23 and 24: World Dissolving Pulp Capacity IS60
Page 25 and 26: FIGURE 1 CELLULOSIC STAPLE PRODUCTI
Page 27 and 28: LDN, 711 112006 Cosmopolis Pulpmill
Page 29 and 30: LDN, 711 112006 wood and vaver bind
Page 31 and 32: LDN. 711 112006 Short term: 1. mold
Page 33 and 34: LDN, 711 112006 o Filling is steam
Page 35 and 36: LDN, 711 112006 an 12'x18' Kamyr wa
Page 37 and 38: LDN, 711 112006 Power and Recovery
Page 39 and 40: LDN, 711 112006 Fiber Procurement O
Page 41: LDN, 711 112006 I timber and land b
Page 44 and 45: LDN, 711 112006 either rail or barg
Page 46 and 47: LDN, 711 112006 Transportation Mode
Page 48 and 49: LDN, 711 112006 opportunities to mo
Page 50 and 51: COMPETITIVENESS
Page 52 and 53: Graph 1 Acetate Cash Production Cos
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LDN, 711 1/2006 11. Refine the abov
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LDN, 711 112006 tighten the local h
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Mill Location- Feber Product Locati
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Port Alice Pulp Export Sales 1997 S
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ENVIRONMENTAL
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LDN, 711 112006 recovery units has
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LDN, 7/5/2006 Mill Site Environment
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Notes Regarding the Pro-forma Finan
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Cosmopolis Pulp Mill Pro-forma Fina
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LDN, 71512006 Potential Site Altern
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Adding Ethanol Manufacture to the E
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LDN, 7/5/2006 Bv-Product Ethanol Pr
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LDN, 7/5/2006 Conclusion: In the 'c
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- equipment and cement, steel, and
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Table 2-Total enerqv requirements o
Page 103:
Pimentel, David. 2003. Ethanol Fuel
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