Pellet mill site getting ready

Paul Bickford/NNSL photo
Brad Mapes: majority owner of Aurora Wood Pellets Ltd. looks over a map of a mill site footprint in Enterprise.

There are now some very visible signs that preparatory work is well underway at the site of what will be a wood pellet mill in Enterprise.

On June 16, Brad Mapes, majority owner of Aurora Wood Pellets Ltd., took The Hub for a tour of the mill site on 320 hectares of land he bought from the Hamlet of Enterprise.

“We’ve got about 15 hectares of land that we’ve cleared,” he said. “We need probably about 20 more hectares to be cleared to get our first phase of our site development ready.”

Mapes said construction of permanent buildings should begin by May 1 of next year, with that work expected to take about 10 months.

That would mean the mill could be ready for operation by February or March of 2019, if everything goes well.

“So this year we’re looking to try to get our logistics side of it. Have our road accesses all done, have our rail spur that we’re trying to have a commitment with,” said Mapes. “We still have to work with CN to get that finalized, but I think that’s going to be one of them things where it’s going to be a no-brainer that it’s going to happen.”

In addition, possibly one or two chip storage units – basically large tents – will be erected this year, and a chipper machine may be purchased and brought onto the site.

And while things are changing on the ground, organizational changes are also coming for the project.

Mapes, a well-known Hay River businessman and the community’s mayor, explained the project will be divided into four separate companies.

“One is going to be Aurora Wood Pellets, which is the plant itself,” he said.

“Then we’ll have Aurora Harvesting Company, which would be the harvesting company for going into the communities,” Mapes explained. “The communities would still have to do some of the paperwork and some of the planning. The actual harvesting would be done by our company.”

That is a significant change because the harvesting communities of Fort Resolution and Fort Providence had initially planned to do their own harvesting through development corporations owned by First Nations and Metis councils.

However, that has changed because the community corporations faced a difficult prospect in financing equipment.

“Our company would have an easier way to find ways to finance it,” said Mapes.

In addition, he said the arrangement takes pressure off the communities.

“It basically puts us in a spot where we have to make sure that we’ve got the harvesting being done and, at the end of the day, it is a major issue,” he said. “If we don’t have the right amount of harvesting done, it shuts down our operation.”

Aurora Harvesting Company will still offer employment and contracting opportunities in Fort Resolution and Fort Providence.

“And then the plan with the harvesting company is slowly to be able to get the aboriginal groups to look at taking over that harvesting company itself,” Mapes said.

That option will be part of benefit agreements, which Mapes calls legacy agreements. The agreements will allow the communities to eventually assume an ownership stake in any of the four new companies.

The harvesting communities will also remain the right holders under forest management agreements with the GNWT, meaning they will charge Aurora Harvesting Company a fee for the timber.

They’re probably going to be further ahead because they don’t have to worry about cash flow, said Mapes. “They’re just going to get a cheque.”

For Fort Resolution, he said that will mean about $2 million a year in fees.

Mapes noted he is “basically there” for wood fibre agreements with Fort Resolution and Fort Providence.

“We’re going to bring back something to the two groups in the next few weeks that verbally I think that they’ll be able to go with,” he said.

Another separate entity, Aurora Energy, will involve the biomass power generated by the mill.

The fourth company will be Aurora Logistics, which will seek ways to utilize the project’s to-be-built rail spur as a loading area for trains and trucks servicing existing and future mines.

Mapes noted Enterprise is ready to sign a memorandum of understanding on what benefits the hamlet will receive from the project.

By the time the mill is ready to start, Mapes – who owns 95 per cent of the project – expects about $34 million will have been invested.

The other five per cent of the project is owned by Joe Handley, a former NWT premier.

All the money is being raised privately, and no government funding will go into the project.

–Paul Bickford