MeadWestvaco to Invest $285 Million to Construct Biomass Boiler at Covington Mill

MeadWestvaco's Covington mill produces about 900,000 tons per year of high-quality SBS paperboard.

June 27, 2011 - MeadWestvaco (MWV) said that it will invest $285 million to construct a new, state-of-the-art biomass boiler and upgrade associated power infrastructure at its Covington, Virginia (USA), facility.

The project will allow the mill to become self-sufficient in electrical power and steam generation and significantly reduces ongoing operating and maintenance costs, MWV said.

According to the company, the new boiler and related 75 megawatt steam turbine generator system will replace two older and less efficient units. It will primarily burn renewable biomass such as tree bark, wood residues often left behind from logging operations, and residuals from the waste water from the paper making process.

“MWV is committed to strategically investing in our facilities to profitably serve growing global markets for consumer packaging,” said Greg Hansrote, vice president of Covington Operations for MWV. “Today’s announcement is another example of our company’s commitment to continuously improve the performance of our operations. This investment creates reliable power supply at the mill that will support future productivity improvements.”

The company has worked closely with Governor of Virginia Bob McDonnell and officials from Alleghany County and the City of Covington, and expects to secure the necessary permits to begin construction in the fourth quarter of 2011.

The project will take advantage of Federal, state and local incentives, MWV said.

The investment will be financed through a combination of cash and borrowings.

The new boiler and infrastructure upgrades are expected to be operational in the fourth quarter of 2013.

The Covington Mill is the world’s largest solid bleached sulfate (SBS) mill. It produces approximately 900,000 tpy of high-quality SBS paperboard for many of the world’s most popular and recognized tobacco, food, healthcare and personal care brands, exporting nearly 50% of its production to international markets.

SOURCE: MeadWestvaco Corp.