Bioenergy Activities at Holmen Skog

Welcome to Holmen Skog

The Group 2009 Share of sales profit Holmen Timber Sawn timber Holmen Skog Forests & wood Holmen Energi Electric power & energy capital Holmen Paper Newsprint & magazine paper Iggesund Paperboard Paperboard Sales SEK 18.0 bn ● Operating profit SEK 1.6 bn ● Capital employed SEK 22.2 bn ● Employees 4 600

Product-oriented business areas Raw-material-oriented business areas

Production and capacity Holmen Paper 8 paper machines 1 940 000 tonnes newsprint & magazine paper/year Iggesund Paperboard 3 board machines 530 000 tonnes paperboard/year Holmen Timber 2 mills 900 000 m 3 sawn timber/year Holmen Skog 1.0 million hectares forest land 3 000 000 m 3 wood/year Holmen Energi 1.1 TWh hydro power/year Europe Rest of the world Sales

Core businesses
Forest management
Wood procurement to Holmen’s Swedish mills
Timber trade

Wood procurement 2010 Procurement 2010, million m 3 f per year Procurement 2010 million m 3 f/year Total 10,8 of which from: million m 3 f/year Own forests 2,9 Other forest owners 7,6 Import 0,3

Timber trade
Purchasing wood from:
20 000 private forest owners
forest owners organizations
sawmills
Delivering wood to:
other forest industries
sawmills
Trading wood with:
other forest industries

Organisation CEO Group staffs Regions Umeå Lycksele Norsjö Björna Bredbyn-Strömsund Ljusdal Sveg Delsbo Bollnäs Hudiksvall Uppland Västmanland Örebro Sörmland Norrköping Tranås Vimmerby Egen skog Districts
Economy/Administration
Information
Personnel
Silviculture
Technic
Real estate
IT
Strategic development
Örnsköldsvik Iggesund Norrköping

Wood delivery 2010 Pulpwood and saw timber, million m 3 f/year Internal wood delivery million m ³ f/year Braviken 1,1 Hallsta 1,3 Iggesund’s Bruk 1,4 Iggesund’s Sawmill 0,7 Total 4,5 External wood delivery million m ³ f/year Total 6,2 Total wood delivery million m ³ f/year Total 10,7

Holmen’s forests
Total land holdings: 1,3 million hectare
Productive forest land: 1,0 million hectare
Timber volume per hectare: 118 m ³ sk
Timber volume total: 120 million m ³ sk
Tree types

Increasing yield of timber Growth and felling in Holmen’s forests Annual felling Annual growth Volume of timber in Holmen’s forests Cubic metres of timber per hectare, m 3 fub

Timber Import
Import 2010: approximately 230 km 3 f
Greater part of the timber is imported from Holmen Mets in Estonia
Mainly birch wood
The timber is mainly delivered to Iggesund’s Mill
Some quantities are swapped with other forest industries in Sweden

Holmen Skog’s environmental policy: Natural occurring plant and animal life shall be given the conditions needed for long term survival. Priory environmental goals
Five per cent of the forest land is excluded from harvesting.
Deciduous trees shall dominate five per cent of intermediate and moist soils.
Five per cent of the regeneration area shall be burned.
Forest management Environmental goals
Valuable watercourses
Valuable wetlands
Restricted driving damage
Reduced carbon dioxide emissions in logging

Environmental certificates
PEFC – Forest Management
PEFC – Group Certification
PEFC – Chain of Custody
FSC – Forest Management
FSC – Chain of Custody
FSC – Group Certification
FSC – Controlled Wood
ISO 14001

Sweden 378 Estonia 17 Total 395 Number of employees Men 79% Women 21%

Welcome to Holmen Skog Region Norrköping

Holmen Skog Norrköping
6 district of purchasing
1 district of own forest
70 000 ha productive forest
100 employee
Wood procurement 2,6 mil. m 3 f
(0,3 mil. m 3 f own forest)

Main target
Wood supply of own industry
(Braviken papermill & sawmill)
Wood supply of external industry
(Billerud Skärblacka)
External woodtrading
Management of own forests
External sale of bioenergy

Braviken
Papermill
Consume 1,3 mil m3f of pulpwood (spruce)
25% from sawmill
Produce 0,75 mil ton of newspaper
600 employee
Buy 2 TWh power & 0,2 TWh recycled wood
Sawmill
Consume 1,1 mil m 3 f timber (spruce)
Produce 0,55 mil m 3 construction wood
External sale of bioenergy 0,7 TWh
Deliver 0,3 mil m 3 f pulp chips to papermill
110 employee

Braviken

Bioenergy - A growing business with in Holmen

Why bioenergy?
Increased demand from energy sector
Political target 2020 with in EU
Ensure supply of pulpwood
Money – an other source of income
Internal use of bioenergy – exchange fossil fuel
Develop new products integrated with existing
industry (biofuel, wood pellet etc)
Peter Roland Holmen Skog 2011-04-12

Main activities
Increased procurement
Bioenergy – the third sortiment
External sale
Devolopment of production methods
Internal use of biofuel
Coordination of trade and logistic

Increased procurement of bioenergy
Result of larger final cut area
More efficient handlig and preparation of bioenergy in site
Bioenergy – a natural part of the business
Development of small tree harvesting
Stumps – try and learn activity
Integrated sale with Holmen Timber bi-products

Swedish forestry – a part of the energy sector ~7 % primary forest fuels ~45 % energy Peter Roland Holmen Skog 2011-04-12 36 % Pulp & paper 16 % Pulpchips 10 % Bark, sawdust 20 % Sawn products 46 % Sawtimber 8 % Energy wood 27 % Black liquors TWh 46 % Pulpwood Annual cut Sources: Skogsindustrierna, 2007, Skogsstatistisk årsbok 2007 & Skogforsk 2010

Customer of bioenergy Biopower plants (producing heat and power)

Prognosis of Bioenergy sale - Holmen Skog & Timber, Norrköping Peter Roland Holmen Skog 2011-04-12 Numbers inGWh Holmen Skog 2009 2010 2011 2012 2013 Stumps 13 10 10 15 Small trees 10 30 45 75 90 Harvest residues 170 191 275 337 487 Energy wood 231 191 241 309 325 Total 411 425 571 731 917 Holmen Timber Sawdust 0 0 119 212 243 Bark 0 0 143 257 293 Dry chips 0 0 46 83 95 Shavings 0 0 8 41 78 Total 0 0 316 593 709 Timber & Skog total 411 425 887 1324 1626

Prognosis of Bioenergy sale - Holmen Skog & Timber, Norrköping Peter Roland Holmen Skog 2011-04-12

Development work
Education – employees & contractors
-Bioenergy is the third sortimnet
Technology and method development
-Holmen is a part of ESS (Skogforsk)
Logistics and sale
-Establishment of storage sites
-Deeper relationship with customers
Administrative system
= More effective and greater harvest of primary wood energy -> Profitable business

Stump harvest
On going activity in Sweden since 2006
-Cleaning harvest sites after the storm ”Gudrun”
On and Off activity at Holmen since 2007
Harvested area: 2007 80 ha
2008 83 ha
2009 15 ha
2010 40 ha
Why harvest stumps?
-Large potential
-Try and learn
-Supply market

How does it work? Peter Roland Holmen Skog 2011-04-12
The Contractor
Contracted excavator with stump harvest aggregate
-Several diffrent aggregates are avalible in the market
Contractor must be PEFC-certified
Machinery must be equipped with computer and GPS
Site directive must be followed
Site selection
Spruce dominated sites are preffered
Avoid wet and moist sites due to risk for damage the ground
Sites with short forwarding distance
Good road standard
Enough storage place at road side
Soil type – silt-sand
Short transport distance to customer
The site area should be at least 3-4 ha

How does it work? Peter Roland Holmen Skog 2011-04-12
The Operation
Excavator harvest the stumps
Site preparation possible
Storage on site
Forwarding of stumps to road side
Storage on road side
Transport to customer or crush on site

Conclutions Peter Roland Holmen Skog 2011-04-12
Important to choose right site
Site preparation might be insufficient
Handling of the stumps highly effects the ash content
Don´t put energy on harvest small and too big stumps
Be aware of risk for later plantation
Logistics must be developed
Contribute with 150 – 200 MWh per ha and possible more
Production cost can and has to be reduced
Private forest owner expect to be payed
Huge potential, but FSC sets limits

Limitations of potential - future challenges Peter Roland Holmen Skog 2011-04-12
Site condition
FSC-legislation
Operation costs
Supply & demand
Knowledge ”know how”
Main focus still on roundwood
Logistics
Cooperation forestry and energy business
Politics
Contractors

Forwarding of residues

Small tree harvesting

Thank you! Peter Roland Holmen Skog AB Manager of bioenergy E-mail: peter.roland@holmenskog.com

Bioenergy Activities at Holmen Skog

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