The companies Fibenol, Biojet, Horizon, Power2X and VKG Fiber will continue competing for the less valuable pulpwood and logging residues sourced from state forests, the State Forest Management Center (RMK) announced. These companies are vying to secure long-term raw material supply contracts for the chemical or microbiological processing of wood.

According to RMK, the qualification was the first of three negotiation phases, established when the sales notice was published. The companies were tasked with submitting business plans that met the requirements outlined in the sales notice, presenting these plans and answering questions from the evaluation committee. The committee determined that all companies' documentation and business plans met the qualification criteria.

The evaluation committee is now proceeding with the second phase, which involves assessing the business plans. These evaluations will focus on added value, the amount and duration of carbon sequestration and the sustainability of the business plans.

"The committee will base its assessment on a specific evaluation methodology," RMK explained. "A key factor is whether the project helps create a higher value-added product, with a significant economic and financial impact on the Estonian economy as a whole. The novelty and applicability of the production technology will also be considered."

Another selection criterion is the environmental impact – specifically, how much carbon the planned products can sequester and for how long, as well as the products' potential to replace fossil fuel emissions.

The third criterion, according to RMK, is sustainability and alignment with Estonia's climate goals. Projects that provide clear support for these climate goals and present realistic financial plans will earn more points.

The evaluation of business plans is expected to take up to two months. Afterward, RMK's board will make a decision, based on the evaluation committee's recommendations, about which companies to proceed with in long-term contract negotiations for establishing the new production unit.

Companies that reach the final stage will need to provide RMK with timely updates on the progress of their production unit. This includes information about land use rights, completed environmental and socioeconomic impact assessments, issued environmental and construction permits and investment decisions.

By creating conditions for the establishment of a wood processing plant, RMK aims to meet the state's expectation of maximizing the value-added processing of wood within Estonia.

RMK is offering the market approximately 0.7 million cubic meters of less valuable wood, primarily pulpwood, for chemical or microbiological processing annually, which has so far been largely exported, and up to 0.14 million cubic meters of wood chips from logging residues and brushwood.

Starting in 2024, RMK will sell wood under long-term contracts exclusively to wood processors operating in Estonia. Intermediaries will no longer be able to purchase wood through these contracts.

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