The demand of pellets as energy carrier and the competitiveness of wood biomass are the drivers for finding alternative raw materials for production of pellets. The aim of this study was to investigate the steam explosion of lignocellulosic residues such as, straw, sawdust birch, sawdust spruce, GROT (mixture of 30 % bark and 70 % industrial chips), and their mix to co-production of value-added chemicals and high-quality pellets. The raw materials were first impregnated with water/acetic acid prior to steam explosion process, while leaching and washing of steam exploded biomass was used to reduce the ash content. The value-added chemicals were extracted with MIBK, and a gas chromatography was used to determine which value-added chemicals are present in the MIBK filtrates after extraction of the steam exploded biomass. Thermogravimetric analysis and Fourier transform infrared spectroscopy, elemental analysis, calorific values, compression strength and density were used to assess and compare the quality of steam exploded biomass and pellets quality. The results from the extraction experiments shows that furfural, HMF, vanillin, syringaldehyde and coniferaldehyde are the most value-added chemicals extracted from lignocellulosic residues where higher yield of the valuable chemicals was obtained when the biomass was presoaked in acetic acid. The ash content was reduced by 83 % for straw material by washing and leaching of steam exploded straw material when the biomass was presoaked in acetic acid. High quality pellets with high calorific value (20 MJ/kg), high compression strength (228 kN/m), high density (1300 kg/m3) and low ash content (0,06 %) were produced from sawdust spruce and GROT:Spruce mix used in our study. Based on our results, we can therefore suggest that steam explosion process of lignocellulosic residues improves the quality of the biomass to pellets production and at the same time open for the possibility to produce value-added chemicals.