Les JoelDeInk Plant Superintendent Blue Heron Paper Company Blue Heron Paper Company Oregon City, 15 miles from Portland, OR Oregon City, 15 miles from Portland, OR 700 tons per day of Newsprint/Specialty 700 tons per day of Newsprint/Specialty LA Times, Fresno Bee, Sacramento Bee LA Times, Fresno Bee, Sacramento Bee Vertis, Quebecor – higher brightness Vertis, Quebecor – higher brightness McDonalds - bag paper McDonalds - bag paper

Waste Paper Supply 530 Tons per Day Waste Paper 530 Tons per Day Waste Paper Central CA to British Columbia Central CA to British Columbia West Coast to the Midwest West Coast to the Midwest #7 & #8 News, Magazines, Office Pack #7 & #8 News, Magazines, Office Pack Post-Industrial Post-Industrial 250 Tons per Day Wood Chips 250 Tons per Day Wood Chips

Presentation Points History - Source Separated to Commingled History - Source Separated to Commingled Effect on the Mill Effect on the Mill Steps Taken to Counter Steps Taken to Counter Ideas for the Future Ideas for the Future

Chronology 1998 Fall – City of PDX moves to Commingled 1998 Fall – City of PDX moves to Commingled From 14 Separate to All except Glass From 14 Separate to All except Glass Compaction implemented Compaction implemented 1999 – – 2001 Other cities follow Other cities follow Manual Sorting on old lines Manual Sorting on old lines 2002 – – 2003 New automated sorting systems installed New automated sorting systems installed MRF consolidation statewide MRF consolidation statewide Equipment / Process improvements at the mill Equipment / Process improvements at the mill

Reject Volumes to Landfill ’99’00 ’01 ’02 ’03 ’04 Paper Used154K 165K 172K 192K 194K 182K MX #6 #73,000 15,000 19,000 15,000 8,000 5,000 To Landfill5,2007,60010,500 12,900 10,700 11,100 % Cont/Used 3.3% 4.6% 6.2% 6.8% 5.5% 6.1% Landfill (000’s) $260$382 $530 $650 $535 $555 $50/ton

Effects on Mill Equipment Coarse Screens – remove large contaminants Coarse Screens – remove large contaminants ‘98‘99‘00‘01‘02 ‘03‘04 ‘98‘99‘00‘01‘02 ‘03‘04 Baskets Baskets Costs (000’s) $40$60$60$85 $110 $120$114 Costs (000’s) $40$60$60$85 $110 $120$114 Observe – glass, metal, plastic downstream wearing pumps, pipes, etc Observe – glass, metal, plastic downstream wearing pumps, pipes, etc Observe – more frequent outside services to clean pipes, drains, and ditches Observe – more frequent outside services to clean pipes, drains, and ditches

Mill Steps Taken Punish Suppliers Punish Suppliers Difficult due to Pacific NW competition Difficult due to Pacific NW competition Salt with Post-Industrial Salt with Post-Industrial Modernize Equipment Modernize Equipment Drum Pulpers Drum Pulpers Cleaners and Screens Cleaners and Screens Work with Governments Work with Governments

Future Mill Steps $3 MM for Contaminant Removal Upgrade $3 MM for Contaminant Removal Upgrade Physical Protection Physical Protection Separate Bad from Good Separate Bad from Good Dryer Rejects Dryer Rejects Rejects Diversion to Reduce Landfill $’s Rejects Diversion to Reduce Landfill $’s Fuel Sources Fuel Sources Material Recovery Material Recovery Chemistry for Increased Adhesives Chemistry for Increased Adhesives Glass ?????????????? Glass ??????????????

Contaminants Composition - most to least by volume Composition - most to least by volume Cardboard / Boxboard Cardboard / Boxboard Hard Plastics – jugs, containers Hard Plastics – jugs, containers Other paper – wet strength, laminated, coated Other paper – wet strength, laminated, coated Metal – cans, tools, rods, staples Metal – cans, tools, rods, staples Lost usable fiber – adheres to the other residuals Lost usable fiber – adheres to the other residuals Soft Plastics – bags, film Soft Plastics – bags, film Glass Glass Misc- textile, rubber Misc- textile, rubber