The recent announcements from the MNR on unallocated fibre and Ontario Power Corporation (OPG) regarding wood biomass potential have piqued the interest of many in the forestry industry. Opinions on the potential for a wood pellet market to create new opportunity for the industry are varied. Tom Croswell, General Manager of Clergue Forest Management Inc. in Sault Ste. Marie says there has been a lot of interest in biofibre in the Sault Ste. Marie-Wawa area but he is cautious about how much material there is to go around. "I think in dealing with biofibre the expectations are high and these expectations need to be managed so they don’t exceed reality. Many people feel that there is a lot of extra fibre out there and that may not necessarily be the case as much of this fibre is already attached to existing mills. There are various reasons why those mills are not using their full commitment at this time and poor markets is one of them." "Last summer we completed a study with Tembec to look the costs and the feasibility of establishing a pellet plant in the vicinity of the Algoma Forest and Martel Forest. While the study indicated that there could be some potential for this type of industry there are still a lot of unknowns and other developments that need to be considered. St. Marys Paper Corp has a vision of developing a biomass cogeneration facility in Sault Ste. Marie, so there is an expectation that fibre will be going to that facility at some point in the future" Croswell said. "There is interest here but there are also some expectations from current users" Croswell said. "While we are always looking for new opportunities we still have to make sure that current shareholders are maintained and they continue to thrive." In the French-Severn forest, Steve Munro of Westwind Forest Stewardship Inc. in Parry Sound thinks pellet production might be a good fit for the area. "There are probably two or three potential investors interested in putting pellet plants within the forest of varying size" Munro said. "We’ve got the opportunity to have a conifer pellet plant on one side of the forest and possibly a hardwood plant on the other side of the forest." Munro thinks there would be support from residential and private sector pellet users as well as OPG. "A lumber drying facility on highway eleven just north of our forest has started to use pellets in their kilns. So that’s a good thing because our forest is close to them and there could be the possibility of a plant somewhere along the highway 11 corridor." "OPG certainly has some possibilities for this forest as well. We also have a deep harbour in our region at Britt, so we could ship it by boat around to Lake Erie, you don’t have to go through locks." "We are looking at ways to stay afloat over the next two to five years with reduced harvest levels, biofibre could be part of a solution" Munro said. "A lot of our wood goes outside of our forest right now to Espanola or Temiskaming. If those two plants don’t want to or can’t take our wood for some reason we’d love to have someone within our forest that folks could take their biomass to." Jack Harrison of Dryden Forest Management Company in Dryden has concerns about the economic feasibility of pellet production. "My first impression is that companies interested in utilizing available biomass are counting on it being created as a byproduct of the harvesting of merchantable wood; however with this down turn in the economy we aren’t producing the biomass that we normally produce." Harrison said. "Will the biomass companies be able to afford to pay for the full cost of bringing the fibre out instead of just picking up the leftovers for relatively little cost?" "That being said I am positive about the future. The Europeans have done well in expanding the use of biomass for heat and electricity in industrial and residential markets and seem to have the public on board, promoting it as a renewable source of energy. If this technology and public acceptance hits North America then I think creating energy from biomass will eventually increase the wood demand on the boreal forest" Harrison said. "Widespread residential use will be a long time coming but if OPG creates a demand for wood pellets and investors put up plants to feed these Hydro Stations, then it may be possible to make spin off residential pellets that would be affordable enough for people to convert from non renewable sources such as natural gas" Harrison said. "This could be a really good economic driver for the logging industry if it does get off the ground."◊