Plans to construct a biorefinery in Kemijärvi, Finnish Lapland, have moved a step closer to implementation with the signing of a detailed letter of investment intent between Shanying Investment Management Co., Ltd. and Finnish company Boreal Bioref Oy. According to a statement by Boreal Bioref, Shanying aims to become the majority owner of Boreal Bioref Oy, a buyer of the pulp and other bioproducts as well as an operative partner.
The negotiations have been carried out in cooperation with Boreal Bioref's strategic partner and EPC service provider China CAMC Engineering Co., Ltd. Shanying is the third largest producer of packing paper and cardboard in China, and a major player in the international market, owning companies in Europe, United States and Japan. In 2017, Shanying acquired the Swedish company Nordic Paper.
"Shanying intentions show their confidence in the Kemijärvi biorefinery project. Moreover, Shanying participation would not only bring industry experience but also an important channel to the growing Chinese market," says Vesa Koivisto, Head of Industry, Invest in Finland, Business Finland.
Pending the final investment decision and the completion of the environmental permit process and all financial agreements, the construction of the biorefinery could begin this summer and is scheduled to be completed by the end of 2020. According to Boreal Bioref, the total value of the biorefinery investment is EUR 950 million, with a repayment period of less than ten years.
The annual production capacity of the envisaged plant is 500,000 tons of bio-materials and biochemicals. The products will include dissolving pulp, long fibre market pulp and electricity as well as innovative products like microcrystalline cellulose, C5 and C6 sugars, pine oil and turpentine, bioenergy and soil improvement substances. The plant's surplus energy will be converted into electricity and sold to the regional grid. The single-line production design of the biorefinery means that the output mix of products can be flexibly adjusted to appropriately reflect market demand conditions.
Finland has vast forest reserves and is at the centre of several major biorefinery projects. For example, Finnpulp Oy is planning a new softwood pulp mill in Kuopio, Eastern Finland, with an annual production capacity of 1.2 million tons per year, while KaiCell Fibers Oy aims to establish a biorefinery in Paltamo, Central Finland, with annual production capacity of 500,000 tons of pulp and ArbronTM material. Also, Sunshine Kaidi New Energy Group, one of China's largest biorefining actors, is planning to build a biorefinery in Kemi, Northern Finland, that would produce 225,000 metric tons of biofuel per year.
In August 2017, Metsä Group opened its new EUR 1.2 billion bioproduct mill in Äänekoski, Central Finland, which been the biggest single investment in the history of the Finnish forest industry. Furthermore, Green Fuel Nordic Ltd recently announced the successful closing of a financing package for a biorefinery to produce biofuels in Lieksa, Eastern Finland.
"The boom in new biorefinery projects is a strong testament to the unique platform for bio-based production that Finland offers," says Koivisto.
Read more about Bioeconomy in Finland