Area: Profitability analysis
Region: Abitibi-Témiscamingue
Year: 2014
Client: CDIVD

Prefeasibility Study for an Integrated Industrial Project

The closure of the Val-d’Or oriented strandboard mill not only resulted in job losses, but also had significant negative impacts on the remainder of the region’s industrial cluster. The Val-d'Or industrial and commercial development corporation (known by its French acronym CDIVD) therefore decided to implement an integrated project to consolidate and optimize the forest products value chain in Abitibi-Témiscamingue. 

Groupe DDM was asked to assess the main elements of the project and identify the principal costs and revenues. Its first step was to verify and review the CDIVD’s basic parameters and assumptions, examine material flows and inter-company relations, and determine the companies’ respective needs and energy usage profiles. A financial balance sheet was then produced for the first five years of operations, so that the partners could visualize the impacts the project would have on their activities. Lastly, Groupe DDM was asked to develop an organizational model detailing the stakeholders’ roles, critical procurement and production thresholds, any financial issues and the legal aspects of the agreements that would be signed. 

The City of Val-d’Or and the CDIVD announced their intention to move ahead with the project in May 2015. The total investment for the five companies that will be involved in the project is estimated at nearly $350 million, and more than 300 direct and indirect jobs will be created in the region.