First Nations sawmill builders look to the past to solve 21st century problem

Duz Cho Forest Products mill designed to keep dangerous wood sawdust outside and process small beetle-killed wood inside
Duz Cho CEO Al Humphreys displays cants (square timbers) manufactured from beetle-killed logs as small as 15 centimetres in diameter | Tanya Peterson

When Duz Cho Logging went into the sawmilling business, the First Nations company went old school, turning to bush mill technology to solve a modern-day problem.

Instead of installing its modern high-production sawmill inside its building – a former finger-joint plant in the northern B.C. town of Mackenzie – Duz Cho installed it on the outside. The company did so to achieve a specific goal: eliminate the enclosed space that increases the hazard of combustible dust explosions.

Duz Cho made the decision to return to the days of outdoor bush mills, where lumber was cut at the harvesting site, shortly after the 2012 Lakeland and Babine sawmill explosions. Four people died in those explosions, attributed to accumulations of combustible sawdust within the enclosed sawmills.

Duz Cho CEO Al Humphreys said the Mackenzie mill, Duz Cho Forest Products, has dust abatement measures as well, such as a vacuum system. But reversing the standard mill layout of equipment inside and lumber outside is unique to Duz Cho.

Eliminating the prime factor in a dust explosion – an enclosed space – by installing the mill equipment outside made perfect sense for a company where the core business is outdoors work.

“We think like loggers, not like mill people. The way we kept warm in the winter was to work harder,” Humphreys said.

In fact, cold isn’t really an issue. On the outside, the building has a 10-metre-wide canopy extending around one side and along the back, creating a sizable covered area. It is protected yet open to the outdoors, eliminating the risk of an explosion.

In winter, a curtain along one side keeps out the cold, and the mill operators work in booths, insulating them from the cold.

Duz Cho uses the mill building for storing its lumber. The logs are milled outdoors, the employees work outdoors, and the finished product is stacked indoors where it is protected from the elements.

“Our customers really like that because there’s no problem with rain getting on it or dirt getting on it,” Humphreys said.

The mill, which employs 28 people and operates two shifts, held its official opening June 13. It was operating before the official opening and has already developed markets in China, the U.S. and the Middle East, and established a secure source of fibre.

Duz Cho Logging is a full-phase harvesting and road construction contractor that has been operating in the north for 27 years.

The First Nations company decided to go into the sawmilling business when it found that the major licensees in the region were not using beetle-killed timber below 15 centimetres in diameter because they couldn’t even get two two-by-fours from it. It was being left behind or sold as pulpwood.

Duz Cho came up with a plan to mill the small diameter trees into single metric-sized square timbers called cants, which can then be exported for remanufacturing.

“These are not economic trees for the major licensees, but they fit into our mill. We saw that opportunity to take that small log and do something with it,” Humphreys said. “They are small, so it’s definitely challenging because of recovery and logs costs. But it’s plentiful, so we went ahead. We want the dry, dead pine because that’s what we built our mill plan around.”

A cost advantage of using beetle-killed timber is that the logs arrive with a moisture content so low that Duz Cho doesn’t need to kiln-dry it.

“The moisture content in this beetle-killed wood is sometimes only 10%, so it’s better than putting it in a kiln,” Humphreys said.

A drawback to the small timber is that Duz Cho Forest Products can recover only one cant from each log. The rest of it is too small to be milled into boards. It’s chipped and sold to the nearby Mackenzie pulp mill. A conventional sawmill using larger logs can achieve higher recovery by making lumber from the side-cuts on each log. Duz Cho’s biggest challenge is getting that lower-valued, beetle-killed fibre to its Mackenzie mill. It is working on a solution with forest company Conifex Timber (TSX:CFF), which also operates a sawmill at Mackenzie and uses larger timber harvested from the forests at the upper end of Williston Lake.

Forests Minister Steve Thomson attended the June 13 opening and praised the company for its innovation and ingenuity.

“They have managed to take wood that no one else is using and create 28 jobs,” he said.

Duz Cho’s enterprise generates revenue and jobs for the McLeod Lake Indian Band

Duz Cho Logging is one of the province’s largest contract logging companies, harvesting from 800,000 to one million cubic metres of timber a year. The name means “Big Timber” in the Tse’khene language.

Owned 100% by the McLeod Lake Indian Band, Duz Cho employs 240 people in logging, construction and at its new sawmill. Twenty per cent of its employees are First Nations, except for the sawmill, where more than 60% of the employees are First Nations.

In 2012, Duz Cho received the B.C. Aboriginal Business Award for the top community-owned business of the year for its role in working out a fibre supply agreement that led to the startup of the closed Mackenzie pulp mill.

At the awards ceremony, McLeod Lake Chief Derek Orr explained that Duz Cho regularly returns 20% of its profits to the McLeod Lake Indian Band. In 2012, the band received $1 million, he said.

Chief Orr said the money is used for health, education and culture “as we have many projects we want to do in the community to build and grow.”

Currently, Duz Cho’s annual revenue averages $100 million a year.

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