Chilkoot Lumber aims to light up Haines.

AuthorKleeschulte, Chuck
PositionCompany profile

Chilkoot Lumber Aims to Light Up Haines Operators of the reopened and refurbished Haines mill hope to supplement lumber sales with revenue from power generation.

ALTHOUGH TIMBER MARKETS are booming, sharp executives know the timber industry must run efficiently with good marketing and management to continue to make money during the next down cycle. In short, the industry needs to modernize and run much smarter.

In Haines, operators of the Chilkoot Lumber Co.-one of five sawmills that will be open in the Panhandle by late spring-hope they are doing both in their management of the old sawmill they modernized and reopened just over 15 months ago.

The Haines mill has had a checkered history. During the 1960s and '70s, Haines timber man John Schnabel ran the mill between fights over logging tracts in the Chilkat River Valley, north of Haines. The plant processed cantsrough cut timber-almost exclusively for export to Japan.

In the early 1980s Schnabel sought financing from the state's former Alaska Renewable Resources Corp. (ARRC) to modernize the mill and put in a waste heat plant. The facility would be designed to burn wood chips and other wood wastes from the sawmill to generate electricity for both the mill and sale to the neighboring community of Haines, a few miles down the road from Lutak Inlet.

The world recession of 1981 intervened, however, driving Schnabel into bankruptcy, and the waste heat plant sat half-finished at the mill. In 1984 former Sealaska Corp. executive Michael Chittick invested $5 million, refinanced Schnabel's debt and took a shot at modernizing the old sawmill. He kept the plant alive about a year, almost finishing the waste heat facility. But the deepening depression in the timber industry dragged Chittick's operation down. ARRC's board then elected to liquidate the mill rather than throw more money into the operation.

Then came Petersburg lumber mill operator Ed Lapeyri. For years Lapeyri had operated the aging Mitkof Lumber mill at Petersburg. But shallow water at his dock site prevented larger freighters from calling to pick up wood loads. Lapeyri realized the key to future profitability would be the ability to efficiently sell dimensional lumber in the export market without having to transship the wood to other ports for repacking aboard larger ships. Back in Action. In 1986 Lapeyri and partner Pat Ford moved the bulk of their operations from Petersburg to Haines, purchasing the Alaska Forest Products Co. plant...

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