$440M OSB facility nears construction in Cohasset

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A Georgia-based wood products provider is nearing construction of a $440 million oriented strand board manufacturing facility that will serve the state’s building industry and bring hundreds of jobs to Cohasset, Minnesota.

The city of Cohasset is conducting an environmental review of the proposed 750,000-square-foot facility, which will rise on a 159-acre site just west of Cohasset, an Itasca County town of about 2,700 residents.

Project developer Huber Engineered Woods manufactures roofing, wall and flooring products. In an environmental assessment worksheet, Huber said the facility will supply products for the construction industry in Minnesota and surrounding states. Once in operation, the facility will produce up to 785 million square feet of finished product per year, the EAW notes.

Max Peters, director of operations for the city of Cohasset, said in an interview Tuesday that the project will generate 300 to 400 construction jobs, 500 to 600 indirect jobs, and 165 full-time post-construction positions paying $31 per hour on average.

“We’re very excited. We feel very fortunate that they chose Cohasset,” Peters said.

The timing is right because a major existing employer, Minnesota Power, is scaling back operations in Cohasset, a move that will eliminate about 85 area jobs in 2030, Peters said. At one point, Minnesota Power represented about 70% of the city’s tax base.

As part of an effort to generate 100% carbon-free energy by 2050, Duluth-based Minnesota Power announced in January that it plans to close its Boswell Energy Center Unit 3 in Cohasset by 2030, and transform its Boswell Energy Center Unit 4 to be coal-free by 2035.

“As a clean energy leader, we are meeting the challenge of climate change with a reliable energy supply while keeping costs affordable for customers in this region,” ALLETE President and CEO Bethany Owen said in a statement in January.

For its part, Huber Engineered Woods was drawn to Cohasset because of the area’s abundance of “feedstock” — namely, Aspen logs, which are “plentiful in the area,” according to the EAW. Timber will be delivered by truck to the facility and stored outdoors.

As part of the environmental review, the city is taking comments on the project through the end of October. Once that hurdle is cleared, the project is pretty much a “green light,” Peters said, adding that the proposed use is consistent with existing zoning and the city’s comp plan.

“We can’t give permits until after the EAW is completed. It’s a pretty kind of straightforward process after that,” Peters said.

Peters said the city approved $12 million in tax increment financing assistance for the project, including $6 million for public infrastructure improvements and $6 million for private infrastructure.

Finance & Commerce previously reported that an estimated $376.8 million is coming from Huber’s private financing, and the $27.5 million will likely be sourced from “partner investors,” including the Iron Range Resources and Rehabilitation Board. In June, the IRRRB approved a $15 million forgivable loan for the project.

The city plans to install new water, sanitary sewer and natural gas lines to serve the building, according to the EAW. The utility work includes purchasing new easements on Minnesota Power land.

Huber Wood Products, a subsidiary of J.M. Huber Corp., announced plans for the project in June. The mill will produce a “wide range of products and will significantly increase HEW’s ability to service the Western and Midwestern housing markets,” the company said at the time.

“We are pleased and excited to bring this new investment and set of employment opportunities to Itasca County and the surrounding areas,” HEW President Brian Carlson said in a statement in June. “It is our desire for our new Minnesota operations to be a shining example of our company’s commitment to building a diverse and inclusive workforce.”

Construction could begin in late 2021 with installation of perimeter silt fence and berms, followed by clearing and grubbing, topsoil removal, interim site grading and construction of “haul roads,” according to the EAW.

In 2022 and 2023, crews will build a new rail spur to serve the building and construct the buildings, storage areas, parking lots, roads, and associated utilities, according to the EAW. The building is expected to open in 2023.

Michael Lloyd, director of Environment, Health, Safety, & Sustainability for Huber Engineered Woods, said Tuesday that Huber is waiting for the EAW process to play out and “then we’ll take it from there” and do the necessary permitting.

“If we get outside this year, great, but the bulk of construction is going to start next spring,” Lloyd said.

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