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Malakwa mill resurrection

A sawmill in the small B.C. Interior town of Malakwa has been resurrected with some capital—and plenty of hard work—and is now producing green hemlock lumber for the Chinese market.

By Paul MacDonald

The sawmill in the small town of Malakwa in the Eagle Valley of British Columbia’s Shuswap region has an interesting history—at one time, it was essentially owned by everyone in B.C.

The mill started operating in the early 1970s, and was owned at one point by Westar Timber. Westar Timber was part of the British Columbia Resources and Investment Corporation (BCRIC) a provincial Crown corporation that in 1979 distributed five free BCRIC shares to every citizen of the province.

Some B.C. residents still have their BCRIC share certificates, though these days—with the various operations having gone through a number of corporate transformations—the shares are more conversation pieces than anything of value.

The Malakwa sawmill was last operated on a full-time basis by forestry giant Louisiana-Pacific in 2005. It was subsequently sold to private investors, and operated on and off until 2010.

Last year, the mill was purchased by several Vancouver-area investors, and now operates as Elite Forest Products. It started up this past summer, producing dimensional lumber, primarily for the China market.

But perhaps unlike many other sawmill re-starts—especially with the sawmills of the major forest companies, with their large budgets—the focus has been on hard work, rather than capital, at the mill.

And there have been some challenges along the way.

The team working on bringing the mill back to operations mode is made up of mill manager Ray Hanson, Elite Forest Products CEO Devon Buttar and company COO Garry Vinayak. Both Buttar and Vinayak, who are in their early-20s, are new to sawmilling, though they have been learning fast from the 40 years-plus experience of Hanson. “We’ve learned a lot from Ray in the last three or four months alone,” says Vinayak.

Including learning how to roll with whatever came their way during start-up. “Everything has its hiccups when you are starting it up,” says Vinayak.

The hiccups included a power surge knocking out their PLCs. Due to the age of the equipment, they had to source replacement PLCs in Oregon. “If that hadn’t happened, we would have been producing lumber a lot earlier,” said Hanson.

The big challenge was getting the mill’s computer system and PLC’s back and operating after not running for four years. The PLCs essentially had to be re-programmed, and upgrades made—not an enviable task. “The tech person really had to start from zero,” said Hanson.

All this considered, the Malakwa mill re-start moved along well, and the mill was producing lumber this past summer, and its first shipment was loaded and bound for China in August.

At this point, the mill employs about 20 people, which is understandably a big deal for the town of Malakwa, which only has about 750 residents. The company has a Timber Licence, and once harvesting gets started, another 10 to 15 people will be employed. The company’s management trio hopes that by next year, they will employ upwards of 40 to 50 people.

The Timber Licence will meet about 30 per cent of their timber needs; the plan is for the balance to come from timber purchases/trades with mills operating in the region, including Louisiana-Pacific, which produces laminated veneer products and plywood at an operation in Golden, and Downie Timber in Revelstoke, both of which are not too far down the Trans-Canada Highway from Malakwa.

“We’re working with the local mills,” says Hanson.

The company’s Timber Licence includes a variety of wood species, which they will be looking to trade. And Hanson says they’ve had a good response to that initiative.

“It’s a good fit with the mills that are already here in the region—we’re looking for different wood, and we’re not cutting in their lumber markets.”

The Elite Forest Products mill is a good fit for the region in that it is running hemlock, a species the other mills in the area don’t process. “Hemlock will be our prime species, and all the other mills are processing fir, cedar, lodgepole pine,” says Hanson. “There are very few mills that specifically cut hemlock in the B.C. Interior—but it’s more common on the coast.” About 80 per cent of their green hemlock production will be exported to China, through a Vancouver-area broker, with the balance going into the U.S. market.

Even though it last ran in the summer of 2010, the mill’s equipment was actually in reasonably good shape, thanks to Hanson’s efforts caretaking the mill in the interim.

Elite Forest Products mill manager Ray Hanson (left) says there was a sense of excitement when they ran the first log through the line, after the mill had been shut down for years. “Not too many months ago,” he says, “we were looking at an empty old sawmill.”

Hanson notes that the equipment in the two-line mill is solid and dependable, but not recent. On the large log line, they have a rosserhead debarker that can handle up to 60 inch logs, and on the small log line, they have an 18” Nicholson debarker. The small log line has a Kockums CanCar (now USNR) chip ‘n saw canter that handles up to 16” logs, and the large log line has a Letson & Burpee seven foot, double-cut bandsaw.

“The newest equipment in the mill is the Letson and Burpee bandsaw, which was installed in the early 1980s. We can bunk a 50 to 60 inch log, with that, so we can cut big timber. The planer mill, which is a 16 knife Newman, was installed in the early 1980s, too. It isn’t top of the line equipment, but it’s in good shape.”

The small log line has a Ukiah vertical double arbor edger, and the large log line also has a Ukiah double arbor edger. They also have a Schurman bull edger, and a Yates recovery band saw. While they are not currently using them, the operation has two Moore dry kilns.

Equipment-wise, Hanson says, they are fine, considering the timber they are going to be cutting. That’s not to say they wouldn’t look at upgrades as the operation gets more on its feet, perhaps in the headrig area. “But we don’t really need to do that right now.”

While the equipment was in good shape, they still had a “To Do” list when they started working on preparing the mill to operate.

One of the bigger projects involved the chip storage area, where they now have a new concrete pad for chips. “We’ve got enough containment for 35,000 cubic yards of chips,” says Hanson. ‘We also took out the blow pipe and put in conveyors instead, which has meant less maintenance. It makes everything easier.”

That was a priority because they are producing five to seven B-Train loads of chips a week, for the Zellstoff pulp mill in Castlegar, B.C.

For the time being, they will be storing their hog fuel. They have a separator to separate the sawdust from the bark, so they will be able to market the sawdust. There is talk about a new biomass energy system being built in Revelstoke and a pellet mill in the region, so the remaining hog fuel may find a home at those projects, if they go ahead.

“Aside from those areas of the mill operation, we have not made any major changes,” says Hanson.

“Equipment-wise, it was not a big challenge—it was like we have to fix this item on that conveyor, or replace those bearings, mostly minor things. We’ve made some changes, but we’ll be running the mill pretty much as it was run before it was shut down.”

They had to upgrade the scales, and there were still all the necessary permits and approvals that had to be obtained. “It was a big job—and still is,” says Hanson.

Getting an older mill up and operating can make building a new sawmill look like a piece of cake. “It’s much harder than starting out brand new,” says Hanson. “You take a Tolko or West Fraser, if they go to build a new mill, it’s all set up—it’s so much simpler.”

Added to that, this area of B.C. is on the remote side, too. It has only had cell phone service for a year—and it can be difficult to get trades people in to work on the mill, because of its location.

In terms of maintenance, and general running of the mill, Hanson notes they were fortunate in that they were able to hire one of the former millwrights who worked at the mill. “He knows every bolt in the mill.” In fact, many of the people working at the mill are former employees. Hanson himself worked at the mill for many years, and was part of the crew doing the shakedown on the mill, when it was built in the early 1970s.

Over the past year, they’ve had a small crew to get the mill back and operating—it’s pretty much been Hanson, Buttar and Vinayak, and a few other bodies. They are using the services of a local electrician. Basically, they got the mill up and running with a lot of sweat, rather than lots of capital.

The Timber Licence for Elite Forest Products will meet about 30 per cent of their timber needs; the plan is for the balance to come from timber purchases/trades with other mills operating in the region. The company’s Timber Licence includes a variety of wood species, which they will be looking to trade.

One of the biggest challenge they had was the weather; the area had the hardest winter and spring in over 20 years, says Hanson. There was four feet of snow on the mill site at one point. Hanson has a four-wheel drive pick-up, and it had to be pulled out a few times by the mill’s Volvo L180C loader.

“We were up looking at the area where our logging rights are in the last week of May, and there was still snow on the road, let alone on the bush,” said Hanson.

With wood now being delivered, the plan is to run the mill on a one-shift basis; when L-P was operating the mill, which was then a cedar mill, they were producing from 75,000 to 100,000 board feet a shift. The target for Elite Forest Products will be 50,000 board feet a shift, of rough green dimensional hemlock; for the time being, they will be running the wood through the planer to keep it to size, and because it has to be anti-sapstained.

Management is realistic about the current limitations of the mill. “This year, we’ll run it until the weather tells us to stop, probably around December, and then put it to bed and start it up again in March,” explained Hanson. “We won’t be quite up to speed, equipment-wise, to run this winter. And cutting hemlock in the winter is difficult because the wood freezes so easily.” The plan is to run straight through the winter in 2015, though.

Considering what they have to work with, and how far they’ve come with getting the mill up and operating, Hanson, Buttar and Vinayak are proud of what they have achieved, and the contribution it will be making to the local economy. They talk about the excitement about running the first log through the large log line. “Not too many months ago, we were looking at an empty old sawmill,” says Hanson.

“It’s been a tough row to hoe, but we’re there now. The proof was when we loaded the first truck of lumber for the port in Vancouver, headed for China.”