With a $300 million expansion now underway at Ainsworth Lumber’s Grande Prairie facility, the Alberta city will soon be home to Canada’s first oriented strand lumber/ laminated veneer lumber plant.
By Tony Kryzanowski
The demand for new value-added engineered wood products is increasing with the logs for larger dimension solid wood products becoming scarcer and builders using more engineered wood products in their building systems, especially engineered wood products capable of meeting certain load specifications. Those were the primary drivers behind a decision by BC-based Ainsworth Lumber Co to build an addition to an existing oriented strand board (OSB) facility near Grande Prairie, Alberta, that will be capable of manufacturing OSB, oriented strand lumber (OSL), and laminated strand lumber (LSL).
Ainsworth is using a proprietary manufacturing process to put Canada’s first OSL/LSL plant into commercial production, according to Bruce Rose, Ainsworth’s general manager of corporate development. Rose says OSL/LSL products will compete directly with laminated veneer lumber (LVL) in some markets, as well as solid sawn wood products that are often nailed together in construction applications to deliver specific load
capabilities. The immediate target for OSL is the beam and header market. Further down the road, it is expected to find uses in floor joists and roof rafters.
The total OSB production capacity of the Grande Prairie facility will be 1.3 billion square feet annually on a 3/8ths-inch thickness basis. This will make it the world’s largest production facility of OSB, OSL and LSL.
The plant will consume about two million cubic metres of aspen per year. Ainsworth has secured additional timber harvesting permits from the province as well as access to private timber to ensure that it has an adequate supply of fibre to feed the plant. Once operational, the plant expansion will create 85 to 100 additional jobs, bringing the total complement of employment at the plant to about 300.
The company also has plans to construct a value-added facility in nearby Valleyview. It would take some of the output produced by the Grande Prairie plant and saw it into dimensions required by Ainsworth’s customers.
“We’re planning to do a fair amount of the finishing process, some of the machine work and custom cutting in Valleyview,” says Rose. Products can also be shipped in larger dimensions and then custom sawn closer to markets, if it makes more sense to deliver and customize it that way.
The $300 million-plus expansion at the Grande Prairie OSB plant was slated to open this spring. However, a deeper than expected downturn in the American housing construction market and the extra cost for skilled labour in booming Alberta encouraged Ainsworth to slow down construction, with the opening now slated for 2008. Stretching out the construction window has allowed Ainsworth to reduce its onsite construction workforce from 500 workers to about 75.
There is no doubt, Rose says, that inflationary pressures have escalated the overall cost of the project. “We’ve faced significant labour and material cost inflation over the last period of time,” says Rose. “We were paying big premiums to expedite work in fabrication shops in the region because they are very, very busy with oil patch work.”
Faced with a sharp reduction in housing starts in the US from an annual rate of 2.2 million in April 2006 to 1.5 million by the end of 2006, Ainsworth management realized that they were rushing and paying a premium to put more production in the market at a time
when market demand has dropped considerably. So there was no reason to rush the building process, particularly since the building exterior has been completed and most of the construction is taking place indoors. The construction schedule was throttled back to a more manageable and efficient level. Stretching out the construction window will have no impact on OSB production within the pre-existing production line.
One advantage to substituting an engineered wood product for solid wood products on a construction job where there are specific load bearing requirements is that Ainsworth will be able to certify the performance of its OSL/LSL products because of the amount of quality control it has over the manufacturing process.
It is possible to give a general sense of solid wood performance in load bearing applications, but not to the same degree as OSL/LSLproducers of solid wood products are still dependent to a great degree on what Mother Nature provides them.
“There are a lot more homes that are being built in systems now,” says Rose. “Builders are using a lot more engineered wood products and wanting to use products where they actually understand their engineering capabilities.”
There are noticeable differences in the appearance of OSL/LSL versus OSB. For example, OSL/LSL strands are about twice as long as OSB. Also, the strands are all oriented in the same direction in OSL/LSL, compared to the carefully engineered crisscross pattern with OSB.
Rose says the most noticeable difference when walking through an OSL/LSL plant versus an OSB plant is the warehousing and additional custom sawing equipment used to break down the OSL/LSL to specific dimensions.
He emphasizes that Ainsworth is not attempting to produce OSL/LSL to compete directly with high volume wood products like 2x_s and 2x6s used as studs for walls, primarily because OSL/LSL will not likely be cost competitive with these products.
The new production line being added at Grande Prairie has been designed so that the company can readily switch back and forth from production of OSL/LSL to OSB, with some computer setting changes. This provides Ainsworth with two advantages. The company can adjust production depending on shifts in market demand for the respective products.
The second advantage to integrating OSL/LSL production capability within an OSB plant is more efficient utilization of the raw material. This approach will provide Ainsworth with the ability to redirect strands that are too small for OSL/ LSL production to the OSB plant.
The integrated facility will operate more efficiently in terms of fibre usage than stand alone OSB plants that have few commercial outlets for non-spec strands.
Grande Prairie stood out as the preferred site for an expansion into OSL/ LSL production because it is a modern, world class facility. Furthermore, because management, production and woodlands staff were already in place, there were savings to be had in the area of human resources.
The existing plant has also benefited from the expansion project. As part of the overall $300 million investment, about $20 million has been spent to enhance the capabilities of the pre-existing OSB production line.
While the manufacturing processes for the OSB and OSL/LSL lines will be integrated wherever it makes the most sense, Ainsworth is making a significant investment in new equipment.
For example, the company has purchased four new E 932 Liebherr log loaders. Two feed the ponds and two feed the stranders. Nicholson has provided two 27-inch A8 debarkers and Pallman has supplied two PZU 22-725/_8 log ring flakers. GTS supplied a walking grate heat energy system and the electrified filter bed pollution abatement system was provided by EFB Inc. Italian-based PAL provided the screens, while the blenders were supplied by Coil Manufacturing.
The press and forming line are Dieffenbacher products. The press is a Dieffenbacher CPS 295-55.3 continuous flow press that is 55.3 metres long. In terms of production capability, panel thickness can range from 9.53 mm to
57.1 mm. Maximum line speed is 1,000 mm per second. The OSL/LSL billets will be 2.__ metres (eight feet) wide in a variety of lengths. Rose says the majority of OSL/LSL products manufactured in Grande Prairie will range in thickness from 2.5 centimetres (one inch) to _.3 centimetres (1.75 inches).
Ainsworth is targeting the North American market for its OSL/LSL products, but by the time its Grande Prairie plant is operational, it is likely to already have competition. Louisiana-Pacific has announced a $100 million investment to convert its Houlton, Maine OSB facility to OSL, with production commencing in the latter part of 2007. “I don’t think it’s an earth shattering thing whether we come to market first or second,” says Rose.
“That is not going to change our approach to business, what we are doing, and the reason we are doing it.”
He adds that the company’s consistent focus is to produce a higher proportion of value-added products to have less reliance on straight OSB sheathing products. “OSL/LSL products are primarily supplied to the residential construction market, but they provide us with additional value-added products that we project to have more stable operating profits over the long term,” says Rose.
While the focus will be on consumption of aspen in Grande Prairie, Ainsworth has conducted some research and development into the potential use of mountain pine beetle-affected fibre for OSB and OSL production, as well as use of other species.
Many are fishing boat owner/operators who fish in the summer and operate equipment in Alberta over the winter.
This balance means they are employed all year but aren’t forced to uproot their families, homes and established fishing businesses on the East Coast. Dion’s ability to speak French is also an advantage, since many workers from New Brunswick are French-speaking.
“We’re starting to look after them a bit better, like offering to pay their flight up or pay for a flight home at Christmas time,” says Dixon. “Our employees really appreciate that and employee retention is a big consideration for everyone right now.” The company also rents local apartments, each capable of housing up to four workers on a temporary basis. This allows for workers from the East Coast to have a “home” to come back to during their days off.
Dion’s business success has come as no surprise to Dixon, who, along with four other core employees, have watched and been a part of Dion’s rise to business prominence. Dixon started out as a chainsaw operator, then progressed to operating equipment, becoming skilled at handling a wide variety of machinery. He still proclaims an affinity for the feller buncher.
Dixon sustained some serious injuries in a house fire years ago, and although well recovered now, he did go through a long period of time where work in the field just wasn’t possible. Dion saw past these temporary limitations and had a view of the big picture, offering Dixon work at the management level.
For the past five years, Dixon has been the company general manager, working from the Bonnyville office. He typically starts work at _:00 am, and more often than not, locks up the office when everyone else has gone home for the day.
That dependability from his right hand man has allowed Dion the freedom to pursue his other well known passion: race horses. “Danny’s goal is to own a racehorse that wins the Kentucky Derby,” says Dixon. “I have a strong belief that he will do it.”
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