NRCan invests in West Fraser lignin recovery process

June 26, 2014, Calgary, Alta. – FPInnovations and West Fraser
Timber Co. Ltd. (West Fraser) are proud to support the contribution of Natural
Resources Canada (NRCan) of $10 million, under the Investments in Forest
Industry Transformation (IFIT) Program, to support the implementation of a
commercial-scale lignin recovery process at West Fraser’s plant in Hinton, AB.

Details of the contribution were revealed at a press
conference held in Calgary, AB, in the presence of the Honourable Greg
Rickford, Minister of Natural Resources.

“We welcome this announcement, which is a shining example of
how collaboration and strategic partnerships with industries, governments and
research institutions can have a positive impact on traditional markets while
leading the development of innovative new products,” said FPInnovations
President and CEO Pierre Lapointe. “FPInnovations is excited to be the catalyst
that fosters alliances among organizations that have complementary objectives.”

West Fraser’s Hinton pulp mill will be the first in Canada
to extract the lignin from its black liquor recovery stream, enabling it to
produce the quantities needed to meet the supply requirements of end-users,
using a proprietary process developed through past federal investments in
R&D with FPInnovations and NORAM Engineering, called LignoForce. This
project is the evolution of a transformative process that began with an
investment in a similar LignoForce pilot-scale demonstration facility in
Thunder Bay, ON, which was funded by NRCan’s Transformative Technologies Pilot
Scale Demonstration Program, the Government of Ontario and the Centre for
Research and Innovation in the Bio-Economy.

“Lignin recovery offers the potential for high-value, bio-based
chemical alternatives that could have wide application in industrial use,” said
Ted Seraphim, President and CEO of West Fraser. “Developing high-value products
from our existing production reinforces the competitiveness of our operations
and supports rewarding careers in our business. We are excited to explore new
markets and commercial opportunities for this novel, renewable bioproduct.”

The IFIT program provides funding for near-commercial or
first-commercial deployment of innovative technologies in the Canadian forest
sector — a critical step in taking ideas from the research and development
stage to the marketplace. It is part of a broad federal strategy that includes
expanding market opportunities for the forest sector in North America and
overseas.

Initially, West Fraser will pursue the use of lignin as a
renewable, natural replacement for certain glue components used in the
manufacture of plywood and engineered wood products such as laminated veneer
lumber (LVL) and oriented strand board (OSB).

FPInnovations and NORAM Engineering have developed a
proprietary process (LignoForce) to recover lignin from black liquor, which
provides a kraft mill with a new, high value revenue stream, while increasing
pulp production. FPInnovations’ research combined with NORAM Engineering’s
commercial process and technology development resulted in an efficient, low
capital system capable of producing high quality dry lignin. The LignoForce
demonstration plant in Thunder Bay, ON, is capable of producing 12.5 kg/h of
lignin.