BillerudKorsnäs Considering New 500,000 tpy Board Machine at Gruvön in Sweden

BillerudKorsnäs is considering the installation of a new 500,000 tpy paper machine at its mill in Gruvön, Sweden for the production of of liquid packaging board, cartonboard, food service board and white kraftliner.

Aug. 25, 2015 - BillerudKorsnäs announced that it is launching two feasibility studies — one regarding investment into a new board machine at its mill in Gruvön, Sweden; and the other regarding the streamlining and development of the production structure for packaging papers.

According to the company, the new machine would become one of the most cost efficient in the world with a capacity of approximately 500,000 tons per year of liquid packaging board, cartonboard, food service board and white kraftliner.

In addition, an investment decision would also include a streamlining of the production structure within the business area Packaging Paper, as the current production of kraft papers at the Gruvön production unit would be discontinued and replaced by production at other BillerudKorsnäs mills.

A decision about the potential investment scenarios is expected to be made during 2016.

In a press statement, BillerudKorsnäs said, “Driven by global megatrends, the demand for these types of board is increasing. BillerudKorsnäs therefore wants to investigate the possibility of installing a new board machine at the production unit in Gruvön. The investigation is a part of BillerudKorsnäs strategy for volume growth within business area Consumer Board. It is also in line with the strategies for the business areas Containerboard and Packaging Paper.”

Simultaneously, BillerudKorsnäs is studying the possibilities of further structural change and growth in selected kraft paper segments.

“The investigation includes exploring the possibility of moving the MG paper machine in Finnish Tervasaari, unintegrated to pulp production, to Swedish Skärblacka, which is an integrated unit,” BillerudKorsnäs said.

“The investigation also includes investment in further value adding surface treatment capacity at existing MG paper production in Skärblacka.

“If implemented, the investments would strengthen Skärblacka's position as one of the world's most efficient production units for white MG papers while also opening up opportunities in attractive market segments within medical papers, food packaging and release liners,” BillerudKorsnäs concluded.

The investigation will be completed during the first half of 2016 and after a potential decision is taken, about a year is required to carry out the investment in surface treatment capacity, and one and a half years for a potential paper machine move, the company said.

Per Lindberg, President and CEO, BillerudKorsnäs, said, “These two investigations clearly indicate that we have our sights set on growth. We carefully compare all different growth scenarios to each other. Right now, we consider conditions for organic, investment driven, growth in our own production structure as the most favorable. These investigations do not exclude the possibility of further acquisitions.”

BillerudKorsnäs noted that the investigations are independent of each other. Also independent of the outcome of the investigations, BillerudKorsnäs invites to union negotiations regarding a possible closure of the BillerudKorsnäs production at Tervasaari.

BillerudKorsnäs is a world-leading manufacturer of packaging papers, including: kraft and sack paper, liquid packaging board and cartonboard, and containerboard (fluting and liner). The company also produces market pulp. To learn more, please visit: www.billerudkorsnas.com.

SOURCE: BillerudKorsnäs