Competitiveness to Innovation Alberta Forest Products Association. Pierre Lapointe President and CEO FPInnovations September 22, 2016

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1 Competitiveness to Innovation Alberta Forest Products Association Pierre Lapointe President and CEO FPInnovations September 22, 2016

2 A Unique Private-Public Partnership Canadian Wood Fibre Centre Vancouver Hinton Edmonton Québec Colleges and Universities, Provincial and Federal Governments Thunder Bay Montréal Main Offices Employees: 525 Annual Budget: $90M 2

3 FPInnovations Alberta Members 1. Al-Pac 2. Alberta Newsprint Company (ANC) 3. ACQBUILT 4. Boucher Bros. Lumber Ltd. 5. Canfor 6. Genics Inc. 7. Millar Western Forest Products 8. Norbord Inc. 9. Northland Forest Products Ltd. 10. Spray Lake Sawmills Ltd. 11. Tolko Industries Ltd. 12. Vanderwell Contractors Ltd. 13. Western Archrib 14. West Fraser 15. Weyerhaeuser Company 16. Zavisha Sawmills Ltd. 3

4 Vision A world where products from sustainable forests contribute to every aspect of daily life. TALL BUILDINGS made of wood? Engineered Wood Bridge building Environmentally friendly products Automated Logging TRUCKS Drones for forest surveillance Optimal use of our RESOURCE Interior products for trains, planes and automobiles LIGHTWEIGHT Airplanes The food we eat Remotely controlled Transportation 4

5 Vision starts with a Competitive Industry 5

6 COMPETITIVENESS & SUSTAINABILITY Continuous improvement is core to our research program We do this through: Strong operational research programs Knowledge and technology transfer, and Implementation De-risking research and development 2016 FPInnovations. All rights reserved. Copying and redistribution prohibited. FPInnovations, its marks and logos are trademarks of FPInnovations.

7 Alberta WWP Program Testing frozen Alberta pavement in the lab! Collaborative research with Alberta Transportation, City of Edmonton and Laval University Possible 2 week gain in the fall Estimated Savings $1.6M per week of hauling with WWP) Conducted 36 bridge evaluations between Slave Lake and Whitecourt in 2016 Full-scale heavy vehicle simulator FPInnovations. All rights reserved. Copying and redistribution prohibited. FPInnovations, its marks and logos are trademarks of FPInnovations.

8 Increased Payload Capacity 8-axle tractor/semi-trailer 7-tonne payload increase for summer operation Reduction of 5% in energy intensity (L/m 3 ) Like 1200 cars off the road 10-axle B-train 10 to 20 tonne payload increase (25% to 50%) 15% to 30% reduction in energy intensity (L/m 3 ) Like 3000 cars off the road FPInnovations. All rights reserved. Copying and redistribution prohibited. FPInnovations, its marks and logos are trademarks of FPInnovations.

9 Pipeline Crossings in Alberta Standardize pipeline road crossings to improve cost estimates and scheduling Alberta field tests conducted with Access Pipelines and Midwest Pipelines Proposed crossing arrangements requires endorsement by companies and governing agencies Field tests of winter and wetland pipeline crossings planned Estimated savings of $360,000/year per operation (200 crossings) FPInnovations. All rights reserved. Copying and redistribution prohibited. FPInnovations, its marks and logos are trademarks of FPInnovations.

10 Pilot Project for Indigenous Communities A two year pilot program in Alberta Successfully completed 12 projects: Market and economic feasibility analysis Operational and technical evaluations Resource Assessments Skills development and knowledge exchange ROI on Provincial investment: 6: FPInnovations. All rights reserved. Copying and redistribution prohibited. FPInnovations, its marks and logos are trademarks of FPInnovations.

11 Pilot Project Results Performance Indicator Achieved Expected Potential Total Communities Engaged Businesses or programs created or maintained Jobs created or maintained Partnerships Fostered Indigenous Capital Investment $550,000 $715,000 $10,540,000 $11,805,000 Economic Benefits $235,000 $1,083,000 $1,925,000 $3,243, FPInnovations. All rights reserved. Copying and redistribution prohibited. FPInnovations, its marks and logos are trademarks of FPInnovations.

12 Wildfire Operations Research in Hinton Based in Hinton, Alberta, since 2001 Provides leadership in research in wildfire operations and wildfire technology development. Mission - conduct research addressing current operational issues identified by wildfire management practitioners within the forest industry. Projects in Community Protection, Detection, Fuel Management, Aerial Firefighting FPInnovations. All rights reserved. Copying and redistribution prohibited. FPInnovations, its marks and logos are trademarks of FPInnovations.

13 FUTURE SECTOR Low cost, high recovery fibre supply Advanced building systems Hygiene products & packaging Bio-based chemical market Leveraging green credentials CURRENT SECTOR Increasing timber supply costs Healthy solid wood market Advanced lumber products Pulp market transitioning Incremental environmental gains

14 And IMAGINE 14

15 A Forest where Genomic selection identifies trees that are best fit-tomarket and resistant to the impacts of climate change 15

16 And A more intelligent inventory is completed using drones; Lands are better managed for current and future use Forest fires are detected early; Mapping evolution of pest damage; 16

17 A Forest where Remote control harvesting creates a safer, more productive workforce 17

18 And Automated logging trucks deliver directly to the mill site while reducing fuel costs and carbon emissions 18 18

19 A Forest where Software applications pinpoint the location of the right tree for the right mill for the right product 19

20 And where software optimizes the value of each log Bois d ingénierie 20

21 Where 30-storey wooden buildings are the norm And have a postive impact on climate change. Up to 1 tonne of CO 2 is sequestered in every cubic metre of wood used. 21

22 And wood-based biomaterials are found in planes, trains and automobiles Certain wood-based biomaterials are stronger than steel! 22

23 Where creating wood products helps reduce our carbon footprint Trees absorb and release CO 2 during their life cycle. When converted to wooden products, the CO 2 is not released but captured in the finished product. Brock Commons at UBC is like removing 511 cars off the road for one year 23

24 That can create 24

25 New opportunities for Wood Products Water Crossings and Bridges Mid-rise Wood Building Storey SOM Tall Wood Concept

26 Transform chips to trains, planes and automobiles Lightweight high strength interior finishings for trains Wood Chips Airplane composites Treatment Fuel and composites for cars 26

27 From chips to animal feed Animal feedstock Wood Chips Carbohydrate s Treatment Flocculants 27

28 De-Risking R&D Investment 28 Canada s first Lignin Separation plant 30 T/d Licensing to West Fraser (>$10M) R&D to Demo: $12.5M Applications: adhesives, surfactants, composites, packaging World s first Cellulose Nano Crystals plant - 1 ton/d CelluForce is a Joint Venture FPInnovations and Domtar ($45M) R&D to Demo: $10.5M Applications: hydrocarbons, tissue, towel, thermoplastics, nonwovens World s first Cellulose Filament plant 5 ton/day Strategic alliance with Kruger ($43M) R&D to Demo: $21.5M Applications traditional and non-traditional: rheology, strength reinforcement, optical Bio-Refinery Pilot Plant in TMP mills Strategic Alliance with Resolute Forest Products ($22M) Applications provide renewable, biodegradable and cost-effective alternatives to petroleum-based products for use in the construction, automotive, mining, oil and other sectors. Hinton, AB Windsor, QC Trois-Rivières, QC Thunder Bay, ON

29 Indigenous Communities are Fully Engaged Technology transfer and business development services Matching resource development strategies with existing infrastructure Building capacity within Aboriginal communities Product and business development 2016 FPInnovations. All rights reserved. Copying and redistribution prohibited. FPInnovations, its marks and logos are trademarks of FPInnovations.

30 Who would have thought 30

31 That all of this Surface Elevation Forest Canopy

32 Starts with a simple TREE and a competitive, innovative industry from forest operations to end products! 32

33 Q&A THANK YOU! Follow us:on 2015 FPInnovations. All rights reserved. Copying and redistribution prohibited. FPInnovations, its marks and logos are trademarks of FPInnovations.

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