Sappi Saiccor mill upgrade underpinned by ‘healthy’ dissolving wood pulp demand

9th August 2019

By: Tasneem Bulbulia

Senior Contributing Editor Online

     

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JSE-listed forest products group Sappi’s investment of R7.7-billion in its Saiccor mill – a two-part project called Project Vulindlela – in Umkomaas, south of Durban, has, since the announcement a year ago, been progressing apace and it is expected that the proposed fourth quarter of 2020 completion date will be achieved.

The first part of the project constitutes a R5.5-billion investment in 2018, 2019 and 2020 to expand the capacity of the Saiccor mill to produce 890 000 t/y of dissolving wood pulp. The mill currently produces 780 000 t/y.

The second part of this project constitutes a R2.2-billion investment over five years in various continuous improvement initiatives at the mill.

Sappi manufacturing and technical VP Pat McGrady highlights the two main drivers for Project Vulindlela as being the improvement of Saiccor’s environmental footprint and satisfying customer demand globally.

The company has achieved the first critical mechanical milestone of the project with the lifting of the boiler steam drum having been completed in July, he tells Engineering News.

It has also recorded several other key milestones, including the completion of the piling of the digesters and recovery boiler, and the erection of the steelwork for the recovery boiler, which is nearing completion.

To accommodate the increased capacity of the upgraded mill, a new woodyard with capacity to support upwards of one-million tonnes of pulp was completed in April.

Sappi also received final environmental authorisation for the mill expansion in November last year.

The project scope includes increasing the digesting and chemical recovery capacity of the mill, improving washing and screening of the pulp produced by the digesters and upgrading the pulp bleaching and drying plants.

Key to improving the sustainability of the operation is the substitution of a large part of the original calcium cooking plant with state-of-the-art magnesium cooking, which allows for chemical recovery.

Space is at a premium at Saiccor mill, therefore, all redundant areas will have to be reconfigured to accommodate the installation of the new plant, McGrady emphasises.

The next critical milestones for the project will include tie-ins to the existing plant, modifications to the bleaching plant and upgrading the pulp dryer.

The continuous improvement initiatives at Saiccor, which comprise the second part of the project, will result in the mill’s capacity increasing to more than one-million tonnes a year.

“Securing sufficient timber resources will be critical to support a further expansion,” he notes.

The current project installation is sized to easily increase capacity when the mill is ready and, therefore, the decision to further expand the mill’s capacity will be made in 2020 once the current project has been bedded down, says McGrady.

He attributes Sappi’s successful progress in executing Vulindlela to the lessons learned from the previous project upgrade at Saiccor in 2008. This has reduced the project risk significantly in terms of cost and timing, he adds.

Sappi has appointed consulting firms AF and Wood to jointly manage Project Vulindlela. AF was appointed because of its process knowledge on previous dissolving wood pulp projects, while Wood was selected for its local and international project management expertise.

Both companies have also undertaken extensive work for Saiccor in previous projects.

Moreover, Sappi has appointed its own team of project and engineering experts to oversee the project and ensure that its interests, governance and processes are upheld, notes McGrady.

Augmenting Sustainable Supply

Sappi is a leading global producer of dissolving wood pulp, speciality products and packaging paper, printing and writing paper, as well as biomaterials, with the group headquartered in South Africa.

Saiccor is the largest producer of dissolving wood pulp globally.

Vulindlela’s boosting the mill’s production to 890 000 t/y will take it to about 10% of the global market, and Part 2 of the project has the flexibility to increase production to more than one-million tonnes.

Through the expansion of its dissolving wood pulp production by 110 000 t/y, Sappi expects to entrench its leadership position in the global market.

Demand for dissolving wood pulp will stem from the growth of Sappi’s existing client base, McGrady notes.

Engineering News reported in May that the dissolving wood pulp market was expanding at about 6% a year, partly to meet growing textile industry demand and because the product is regarded as more environmentally sustainable than either cotton or polyester.

Also known as dissolving cellulose, dissolving wood pulp is used by converters to manufacture a wide range of products, but is especially widely deployed in the production of viscose staple fibre, used in clothing and textiles.

Sappi reiterated its optimism in May about the prospects for the dissolving wood pulp market beyond 2020. While there are current pressures in this regard, Sappi noted that this had arisen as a result of an oversupplied viscose staple fibre market rather than any fundamental imbalance in the dissolving wood pulp market. Dissolving wood pulp is an input material in the production of viscose staple fibre.

“We expect continued healthy demand for dissolving wood pulp. The forecast of lower prices and volumes next quarter is because of market pricing and planned shutdowns,” Sappi Group CEO Steve Binnie told Engineering News in May.

McGrady says all additional capacity from Saiccor’s increased production will be exported.

“Sappi already exports a large volume through the Durban port. An additional 110 000 t will augment our existing port use,” he notes.

While Vulindlela will increase production volumes by 15%, this will be done sustainably, thereby lowering Saiccor’s and Sappi’s environmental footprints.

Environmental benefits include carbon dioxide emissions being halved, water consumption being reduced by 5%, water use efficiency increasing by 17%, energy efficiency being improved by 10% and renewable-energy use increasing by 20%.

Moreover, coal consumption will reduce by more than 130 000 t/y and, with that, fossil carbon emissions will be halved.

Waste to landfill will be reduced by about 50% and gaseous emissions into the atmosphere by about 40%.

“Naturally, mill profitability will improve significantly, as well as sustainability,” notes McGrady.

Also, cost savings attributable to Vulindlela are expected to be at least R300-million a year.

Provincial Powerhouse

The bolstering of the economy by Project Vulindlela also reaffirms Sappi’s commitment to KwaZulu-Natal and South Africa.

“Sappi will have invested close to R15-billion in the South African economy in the five years to the commissioning of the first phase of this project and it intends to continue to invest substantially in the five years thereafter, with a high proportion of this investment in KwaZulu-Natal.

“This is a key indicator in its confidence in South Africa and KwaZulu-Natal,” says McGrady.

Foreign currency generated by the increased capacity of Saiccor will initially be about R1.3-billion a year and could peak at R1.8-billion, he indicates.

This will benefit South Africa to the tune of about R1-billion yearly, with expenditure in KwaZulu-Natal to entail about 65% of this.

Further, Vulindlela was the first project showcased at President Cyril Ramaphosa’s Investment Conference last year, during which project commitments of more than R290-billion were highlighted.

The project was also warmly received by KwaZulu-Natal Premier Sihle Zikalala last year, owing to the positive effect it is expected to have on the province’s economy.

In a statement in 2018, Zikalala extended the provincial government’s support to Sappi to seamlessly obtain all the necessary authorisations to make the planned investment a reality. McGrady notes that this promised government support has materialised.

Building Communities

The short-term benefits of Vulindlela include notable job creation.

The construction phase of the project is expected to peak at about 2 200 employees, 40% of whom will be sourced from the local communities, 40% from KwaZulu-Natal, 15% from within South Africa and 5% as specialists from foreign countries, states McGrady.

Further, once completed, the plant will require 120 full-time employees to maintain and operate equipment.

To facilitate the skills required locally, Sappi established a skills training centre close to the mill in January 2018, where required skills training and assessment are taking place.

McGrady says, while construction began only recently, Sappi has trained and employed 431 local persons on the project.

Also, 185 welding assessments have been carried out and 247 persons have benefited from the upliftment training Sappi has provided.

In addition, 45 persons have received basic scaffolding training.

McGrady notes that local community expectations for Vulindlela in terms of job creation and small, medium-sized and microenterprises (SMMEs) use are high. Sappi has embraced this challenge and has placed emphasis on using the services of local SMMEs, with R7-million having been spent on employing their services to date.

Moreover, he enthuses that the success of the skills centre has prompted the decision not to close it after the project has been completed; it will focus on young school leavers and persons wanting to improve their skills. Artisan accreditation for the centre is under way.

McGrady says that, in the spirit of empowering the communities in the vicinity of the mill through sustainable economic development, Sappi has established integrated community forums that engage local communities on business-related matters, corporate investment issues and skills development opportunities.

Edited by Martin Zhuwakinyu
Creamer Media Senior Deputy Editor

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