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Rayonier’s new lignin site nearing approval


July 5, 2016
By Cindy Macdonald

To serve the growing demand for natural lignin-based products, Borregaard and Rayonier Advanced Materials have concluded a market, technical and engineering analysis regarding a new lignin operation at Rayonier’s Fernandina Beach site in Florida.

The final review of the investment by the companies’ boards of directors is anticipated during the second half of 2016 upon receipt of final permits and incentives from government entities. If the companies elect to proceed, operations are expected to commence approximately 18 months later.

The cost of construction of the lignin plant is expected to be US$135 million over two phases of the project. Phase one, which will have a lignin capacity of 100,000 tonnes, is estimated to cost US$110 million. An estimated incremental US$25 million will be required in phase two to increase the total capacity to 150,000 metric tons. LignoTech Florida intends to access the debt markets to fund a portion of the capital requirements.

A new joint venture company, LignoTech Florida LLC, is to be owned 55 per cent by Borregaard and 45 per cent by Rayonier Advanced Materials.

Lignin, a natural component of wood, is a co-product of the sulphite cellulose manufacturing process. The new operation will process the lignin into value-added products that provide alternatives to fossil fuel-based products used globally in construction, agriculture and other industrial applications.

Rayonier Advanced Materials is a global supplier of high-purity, cellulose specialties natural polymers for the chemical industry. Borregaard produces biochemicals, biomaterials and bioethanol that replace oil-based products. The company’s lignin business constitutes close to 50 per cent of the group’s turnover.