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Wood pellet facility in Russia to help protect profits

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Sweden-based forestry company RusForest is set to work with AS Hekotek, a mechanical engineering company, to build a wood pellet production facility at its sawmill in Arkhangelsk, Russia.

The facility will have an annual capacity of 100,000 tonnes and allow RusForest to monetise its sawmill by-products by exporting wood pellets to Europe.

Total investment is estimated to be approximately €10 million ($13.2 million), with around 70% expected to be financed by local bank facilities. It has been reported the Arkhangelsk region is suffering financial difficulties within its pulp sector and RusForest's sawmill residual revenues are at risk.

‘This investment is crucial to make our Arkhangelsk sawmill profitable,’ says COO Anton Bogdanov. ‘A pellet facility will help insulate our operations from the financial situation of the local pulp mills.’