Metsä Fibre Ready to Begin Second-Phase Prep Work for $1.5 Billion Bioproduct Mill in Kemi, Finland

If implemented, the new Kemi bioproduct mill would replace the current mill (pictured above) and would operate entirely without fossil fuels and produce 1.5 million tonnes of softwood and birch pulp and many other bioproducts annually.

April 1, 2020 - Metsä Fibre, part of the Metsä Group, announced that it has completed the first-phase preparatory work as part of the pre-engineering of the Kemi bioproduct mill in the Kemi mill area in Finland.

The second-phase preparatory work includes emptying the buildings in the future mill area in Pajusaari and relocating operations, after which the buildings will be demolished. These buildings include the Botnia Mill Service panel production facilities and a building known as the 'isolator cabin', for example.

According to Metsä Fibre, the purpose of the preparatory work is to enable the construction of the mill and a smooth start for the related earthworks. The investment decision will be made earliest at the autumn 2020, and the construction of the mill is expected to begin right after that.

As a whole, the pre-engineering of the bioproduct mill is progressing as planned. The financing negotiations concerning the investment of around EUR 1.5 billion have also progressed. In March 2020, Finnvera provided a guarantee for EUR 500 million in credit with an 80% coverage, provided that Metsä Group invests in the new mill.

Financing negotiations with the European Investment Bank and a number of commercial banks continue.

Main equipment negotiations and the development of the logistics required for the new mill are also in progress, in addition to preliminary work for the construction phase, the environmental permit application process and the financing negotiations.

Metsä Group has signed a letter of intent with AFRY concerning the planning of the possible construction phase, and with Fimpec concerning the construction.

Metsä Group's bioproduct mill in Kemi would be the largest wood-processing plant in the northern hemisphere. If implemented, at EUR 1.5 billion, this will be the largest investment in the history of Finland's forest industry.

Efficient in terms of the environment, energy and materials, the mill would operate entirely without fossil fuels and produce 1.5 million tonnes of softwood and birch pulp and many other bioproducts annually.

The mill would use 7.6 million cubic metres of wood per year, representing an increase of 4.5 million cubic metres compared with the current pulp mill.

The new mill would have a significant impact on the Finnish national economy — it would employ around 2,500 people throughout its direct value chain in Finland, including 1,500 new jobs.

Metsä Fibre is a leading producer of bioproducts and bioenergy. Metsä Fibre produces pulp and other bioproducts at four mills in Finland: Joutseno, Kemi, Rauma and Äänekoski; and also has six sawmills: Kyrö, Lappeenranta, Merikarvia, Renko and Vilppula (in Finland) and in addition, Metsä Svir sawmill in Russia. For further information visit: www.metsafibre.com.