Create mask out of this layer now: Layer ? Add Layer Mask ? Reveal All and choose the Gradient Tool of black color to move off almost totally the layer's visibility:



Merge down the grouped layers (ctrl+e) and open in a new window the picture of a burning paper (ctrl+o).



Make a copy of it and insert one of the paper's corners on one of our wallpapers' corners:



Change the layer's Blending Mode on Multiply and erase the background's layer with the Eraser Tool on that place where it is necessary just to make the fire visible.



Make the corrections now on the burning paper's layer concerning the brightness and the layer's contrast (ctrl+l).



Make small corrections also on the color, applying Image ? Adjustments ? Selective Color.



Decolorize everything now, except the fire, selecting the Sponge Tool.



Make a copy now of the pencil's layer and decolorize the copy, applying next option: Image ? Adjustments ? Channel Mixer.



Using the layer's mask and the Gradient Tool make that decolorized pencil's half totally invisible:



Change now the pencil's color: Image ? Adjustments ? Hue/Saturation (ctrl+u).