In December 2015, Sao Hill Industries (SHI), Tanzania, started up a new wood chip, drying and briquetting plant. During January, commercial production commenced and after two weeks, the briquetting press is producing at the rate of 1 ton per hour, or 50% of full capacity. The wood drying capacity is 4 tons of dry biomass per hours and the chipping capacity more than twice this level.

Capex in the plant was $1.4m, increasing to $2m with the inclusion of logistics equipment. The start-up was almost 12 months delayed, due to delivery problems from Brazil where the equipment was manufactured. This has had a detrimental effect on SHI and our customers. The mill includes separate wood chipping, sawdust drying and briquetting manufacturing plants, facilitating sale of all these products. Thus, the new mill will enable SHI to sharply increase its sale of ‘green’ wood chips, along with dry sawdust and wood briquettes. The new completed mill is shown below, and while under construction.

The objective of the new factory is to establish a new US $1m per year business, with a significant cash margin. Most of the production is already sold on long term contracts. Dry sawdust, one of the key products, is replacing HFO in several applications. The wood briquettes are sold for use in industrial boilers. Wood chips are sold to the local pulp industry.

The key raw material for the plant is sawdust, the main wood products that has had no market at SHI to date, and various off cuts and harvesting residuals. Currently, about 40% of SHI’s harvested wood is converted to a saleable product, up from 1/3 two years ago, with a target of reaching 2/3 by the end of 2016, and a final target of 90%. This will both increase the value of GR’s standing forest and the competitiveness of its industrial operations. All major competing sawmills in East Africa will continue to recover less than 40% of the wood raw material.

For more information please contact:

Mads Asprem, CEO Green Resources AS (mads.asprem@greenresources.no)

Viatus Bahati, General Manager, Sao Hill Industries(viatus.bahati@greenresources.no)

Emma Shepheard-Walwyn, Sustainability and Stakeholder Relations Manager, Green Resources AS (emma.shepheard-Walwyn@greenresources.no)

For full press release see: Start-up of Briquetting Factory in Tanzania

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