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Rayonier and Borregaard to produce lignin in Florida

Rayonier Advanced Materials and Borregaard ASA have declared their intent to form a joint venture that will produce lignin-based products at Rayonier’s Fernandina Beach facility in Florida. The joint-venture company will pursue the manufacturing, marketing and sale of lignin-based products, and will be owned 45% by RYAM and 55% by Borregaard.

According to Borregaard, the project increases the company’s lignin products sales capacity by 30%. “The Fernandina Beach project represents an excellent growth opportunity for our lignin business in a global market which for some time has been supply-constrained,” stated Per A. Sørlie, President and CEO of Borregaard.

The Fernandina Beach mill manufactures specialty cellulose and lignin raw material as co-products from softwood. Utilising Borregaard’s know-how and technical expertise, the new company will initially manufacture lignin products suitable for concrete admixture and similar applications targeting primarily the North and South American markets. The products will be marketed through Borregaard’s international sales network.

Lignin, a natural component of wood, is a co-product of RYAM’s cellulose specialties manufacturing process and is currently used for its energy value by the facility. The planned JV would process the lignin into higher-value products that provide environmentally friendly alternatives to petroleum-based chemicals.

The project is expected to be completed in two phases over five years. The companies are estimating capital investment of US$110 million for a capacity of 150,000 tonnes per year. The first phase is expected to begin commercial operations in 2017.

Completion of the new operation is subject to board approval by both companies and conclusion of definitive agreements, as well as final engineering, refinement of capital estimates, and obtaining required permits and other approvals.

Rayonier Advanced Materials is a global supplier of cellulose specialties for the chemical industry, while Borregaard produces advanced biochemicals, biomaterials and bioethanol that replace oil-based products.