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April 2, 2009
A new manufacturer of wood pellets is expected to begin hiring this month at the site of the sawmill whose 2003 closing dampened the Barnstead economy.
Lakes Region Pellets plans to employ 25 workers at the property, largely unused since Timco shuttered. Wood culled from forests within a 50-mile radius will be used for the pellets, creating 75 more jobs in logging and trucking, according to Lakes Region Pellets executives.
The pellet company was formed in February after an alternative energy company called Sanco defaulted on its agreement to purchase the 135-acre property, said Erik and Gregg True, the father-and-son team who had been the face of Sanco's plans to develop a manufacturing, energy and agriculture operation there.
The upheaval in world markets changed the game for the endeavor, which had included plans to burn wood chips to create electricity and produce steam that would be used to heat greenhouses and fish tanks for breeding tilapia. The Trues had said that plan would have created between 50 and 100 jobs at the plant and the need for up to 150 loggers and truckers.
But when the credit crunch hit, they said, banks grew wary of backing projects with a startup lag.
"There was no money to lend for energy projects," said Gregg True, a former Timco manager who is now executive vice president and chief operating officer of Lakes Region Pellets. "All financial institutions want to see a positive cash flow. They don't want a year to get up and running."
Lakes Region Pellets now plans to manufacture pellets for horse bedding and for burning, storing up cash reserves before looking toward energy generation in the future. Retailers throughout New England have committed to purchasing the entirety of the first year of production, Gregg True said.
The site will produce four tons of pellets per hour starting in June before ramping up to 10 tons per hour in October, he said. Sometime in the middle of 2010 they will begin exploring ways to use the wood pellets to simultaneously generate electricity and useful heat, a process that could begin during 2011, Gregg True said.
Heat from burning the pellets could be used to heat greenhouses for growing crops or tanks for raising fish, as it would have under the old plan, or any variety of other purposes.
The $7 million startup costs are being funded by the new company's five owners, who include the Trues. Majority owner Hal Smith has owned the 135-acre property since Timco closed in 2003, Gregg True said.
The town of Barnstead is applying for a $500,000 community development block grant to boost job creation at the company. If the application is approved later this month, the Belknap County Economic Development Council will be charged with loaning the money to Lakes Region Pellets to purchase equipment, said Jennifer Boulanger, executive director of the council.
"It will create a significant amount of jobs in the area, which has an indirect benefit to some other businesses in the area," she said.
The advent of one energy-efficient business could also help other such businesses take root, she said.
Selectman Gordon Preston said the town is excited about the creation of jobs and use of a commercial site that has been underused in recent years.
"We're very enthusiastic," he said. "This is a viable thing, something that can be built upon."
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