Potlatch Corp., the big Spokane-based wood-products company, says its spending roughly $45 million this year to upgrade its North Idaho operations.


While a big chunk of that moneyabout $20 millionis being spent on general upkeep of its six facilities in Lewiston, St. Maries, and Post Falls, Idaho, some big capital projects also are under way or planned.


Among them are a $7.5 million project to replace 32 aging masonry lumber-drying kilns at its Clearwater sawmill in Lewiston with five highly automated kilns, says Potlatch spokesman Mike Sullivan. The new kilns are expected to improve the quality and cost efficiency of our drying process and will result in increased output due to a reduction in off-quality materials, Sullivan says.


The kilns that are being replaced were installed when the mill was built in the late 1920s, he says. The mill, which produces dimensional lumber, inland red cedar siding and decking, and glued lumber products, has an annual capacity of 175 million board feet.


At its Idaho Pulp & Paperboard plant there, Potlatch is spending about $2.3 million on a new head box for its No. 1 paperboard machine, which produces foldable, paperboard box stock for shipment all over the world. The head box is the big vat where pulp and water are mixed at the start of a paper-making line. The Spokane company also is spending another about $2.3 million on drying equipment for that machine.


Sullivan says the projects are aimed at upgrading the quality of that machine so Potlatch can market the goods produced with it for high-end uses such as packaging for cosmetics and pharmaceutical products. The pulp and paperboard plant, built in 1950, produces bleached softwood pulp, and bleached paperboard for packaging and liquid containers, such as milk cartons.


Also at that plant, the company is spending about $5.5 million to put technologies in place to meet U.S. Environmental Protection Agency rules involving both airborne emissions and effluent discharges into the nearby confluence of the Clearwater and Snake rivers.


Earlier this month, Potlatch received a new National Pollution Discharge Elimination System (NPDES) permit that requires it to take steps to ensure adequate oxygenation of the water it discharges into the river, as well as to lower the temperature of that water during July, August, and September of each year.


In St. Maries, where Potlatch operates both a sawmill and a plywood mill, it is spending about $2.3 million this year to improve a lathe, $1.2 million for a new dry kiln, and $875,000 to replace a 27-inch debarker, among other projects. Potlatch also is replacing knot-detection systemsat a cost of about $500,000 eachat both the St. Maries sawmill and the Clearwater sawmill. Both St. Maries plants were built in the mid-1960s. The plywood plant has the capacity to produce about 160 million square feet of industrial-grade plywood annually, and the sawmill can produce about 115 million board feet of lumber annually.


Potlatch also is replacing about $2.2 million worth of equipment on the three tissue machines at its tissue mill in Lewiston. That mill produces bathroom and facial tissues, napkins, and paper towels, mostly for private-label customers. It has a capacity of 180,000 tons of products annually.


In addition to the pulp and paperboard mill, tissue mill, and sawmill in Lewiston and the plywood mill and sawmill in St. Maries, Potlatch operates a particle-board mill in Post Falls. That plant also will get some of the overall $45 million in North Idaho capital spending, but on smaller projects and purchases.


The company employs about 2,200 people in Idaho, some 1,800 of whom work at its Lewiston facilities.


Sullivan says nearly all of its major capital projects in North Idaho for this year already have begun, and all are expected to be done by the end of the year.


Overall, Potlatch plans to spend about $108 million on capital improvements this year, including some projects that were carried over from last year.


This is considerably more than we have spent over the past three to four years, says Sullivan. Our improved balance sheet and cash flow allowed us to lower the bar for capital expenditures to include projects that we might have deferred in leaner times.


Overall, Potlatch has 14 manufacturing or converting facilities in six U.S. states, as well as about 1.5 million acres of timberland in Idaho, Arkansas, and Minnesota. It employs about 3,700 people companywide.