Sappi selects construction manager for $170 million conversion project

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Sappi Fine Paper North America has announced the selection of CR Meyer as the construction management (CM) firm to oversee the $170 million project to convert its pulp mill in Cloquet to chemical cellulose production.

In a prepared statement last week, Project Director Mike Schultz said Sappi chose to award the construction management contract to CR Meyer as the result of “an extensive process.”

Oscar J. Boldt Construction was also one of the primary bidders for the CM contract, and Schultz pointed out the two firms are very similar.

“CR Meyer is headquartered in Appleton, Wis., with offices in Coleraine, Minn., and Boldt is headquartered in Appleton, Wis., with offices in Cloquet,” said Schultz. “Both firms have previously done a great deal of work with Sappi, and we have an excellent working relationship with both of them. We hope that Boldt will now participate in the bidding for the lion’s share of the construction work.”

Schultz emphasized that the contract awarded to CR Meyer is not a general contract for all construction work associated with the conversion. Instead, as construction manager, the firm will conduct such services as job scheduling, cost tracking, managing change orders, controlling documents, overseeing traffic flow to and from the site, and managing safety procedures.

Schultz said CR Meyer will also be responsible for determining how the construction work will be divided into bid packages, though Sappi will make all of the final bid selections.

“This project involves a very big coordination role,” said Schultz, “because there will be so many areas being worked on all at once.”

The project is anticipated to involve some 300,000 construction man hours and employ approximately 400 construction workers at its peak. Schultz said the company plans to utilize local contractors, “people who we have worked with before,” he said, and hire out of the local union halls to the greatest extent possible, utilizing outside labor only if there is not enough local manpower at any particular phase of the project.

“Because there are going to be so many pieces touched at one time, there will have to be a lot of people involved,” Schultz said.

The majority of the design work for the conversion project has already been completed and is now in its final stages. The design principal firm is the global consultancy and engineering company AMEC, with input from LHB and Laurentian Engineering Group, both of Duluth, and a number of others. Schultz explained that Sappi has “a lot of good synergy” with AMEC, since one of its affiliated companies was involved in the Cloquet mill’s original pulp mill design.

With a construction timetable of just over a year, the Cloquet conversion project is on the fast track to get work under way. Schultz said preliminary tie-in work is slated for April during the mill’s annually scheduled maintenance period, though no one will likely see shovels in the ground and construction equipment on site until late April into May. He said start-up of the new line is planned for May 2013.

The conversion will change over the local mill’s existing kraft pulp mill to production of chemical cellulose to be turned into clothing and baby wipes for markets in countries such as China, India and Indonesia and will also involve an upgrade to machines used in its coated paper facility.

It represents the largest investment Sappi has made in North America in some time, and the largest investment at the mill itself since the $500 million former Potlatch mill expansion here in the 1990s.

Schultz commented that the general excitement level around the mill and out in the community regarding the project is high.

“I think everyone likes to see this kind of money being spent here,” he said, “but understandably there is a certain degree of apprehension until they see what kind of change it represents.”

Tags: carlton county, cloquet, business