The plant is set to be completed by Aker Solutions in late 2012 and will have a capacity of 50 megawatts (MW), providing power and processing steam to the mill.
It will be fired with a range of harvested wood and waste totalling approximately 400,000 tons a year.
Markus Tacke, chief executive officer of the Industrial Power Business Unit at Siemens Energy, felt the deal reflected well on the company.
He