Caddo River MillNow, here's the other operation. Heavy and recent capital in place. It is like El Dorado, in that it will need a 3rd kiln to get over 200 MMFBM per year I would think. That's maybe a $5M job so pretty modest.
Then off to the races.
CFF by 2020 should have cut the debt in half, be producing nearly 900 MMFBM in the USA and 550 MMFBM in BC.
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The Caddo River mill is situated on approximately 90 acres in Glenwood, Arkansas, near the southern end of the Ouachita National Forest and approximately 145 km southwest from Little Rock, Arkansas. The mill was originally constructed in the 1970s by Georgia Pacific and operated continuously until 2011 when it was idled. From the 1980s through 2011, the mill underwent multiple capital upgrade and expansion projects, which positioned it as a state-of-the-art, low-cost facility. In 2014, Caddo River Forest Products, LLC acquired the mill and Blue Wolf Capital Fund III, L.P. partnered with the owners of Caddo River in September 2016 to re-start the mill. The mill was re-opened in the second quarter of 2017, after completion of modernization and optimization projects and the construction of a new dual path continuous, direct-fired dry kiln, and has an annual dimension lumber capacity of approximately 185 MMfbm on a two-shift basis.
The facilities at the mill include:
- an approximately 600,000 square foot fibre storage area;
- a log debarking and sorting line;
- two-line sawmill;
- a dual path continuous, direct-fired dry kiln;
- a planer mill; and
- an approximately 50,000 square foot finished goods storage area.
In addition, a second dual path continuous, direct-fired dry kiln is under construction and is expected to be completed in June 2018. The Caddo River mill produces a range of SYP softwood lumber and specialty products, which are primarily supplied to customers in Arkansas and Texas. The mill produces both prime and common grades of products, including, among others, 5/4" decking, 2x4, 2x6 and 2x8 dimensional lumber and 1" appearance grade boards. Historically, approximately 80% of the mill's production is comprised of dimensional lumber with the balance being decking. There is truck access to the site through the town of Glenwood, Arkansas and the mill is in proximity to Interstate 30 and Interstate 40. Additionally, the mill is located adjacent to one of its major customers. The Caddo River mill has a one-day truck delivery cycle time to three cities in Texas that, in the aggregate, account for 10% of all single family housing permits issued in the United States in 2017 based on figures published by the U.S. Bureau of Census.
The Caddo River mill is regarded as an efficient and low-cost mill. Most recently, in connection with the re-start of the mill, its current owner completed a capital expenditure program of approximately
US$23 million to modernize and upgrade the mill, which included:
- reconstruction of an existing dry kiln to a dual path continuous, direct-fired dry kiln;
- construction of a second continuous, direct-fired kiln, which is expected to be completed in June 2018;
- upgrades to existing sawmill complex equipment including log merchandising optimization upgrades, optimization and controls upgrades of the sawmill's primary and secondary breakdown lines, and a thorough maintenance of the complex's electrical, hydraulic and air systems;
- upgrades to the existing planer mill complex equipment including an upgraded high-speed tilt hoist infeed, a complete overhaul of the planer machine and related infeed, the reconfiguration and upgrade of the existing packaging line and the addition of a new secondary packaging line, and a thorough maintenance of the complex's electrical, hydraulic, and air systems; and
- several infrastructure and general repair and upgrade projects, including scales, electrical distribution system, log yard watering system, fibre optic connections throughout the facilities and office facilities.