Norske Skog sees new growth opportunity in bioenergy
Norske Skogindustrier (Norske Skog) has revealed that it will invest approximately NOK 150 million (≈ EUR 16 million) in biogas production with upgrading to biomethane at its Norske Skog Saugbuplans paper mill in Halden, Norway.
Norway-based paper major Norske Skogindustrier ASA (Norske Skog) has announced that it will invest NOK 150 million (≈ EUR 16 million) in the construction of a biogas facility in connection to its wastewater treatment plant (WWTP) at its Norske Skog Saugbrugs paper mill in Halden, Norway. The biogas facility will contribute to gross operating earnings in 2016 and be at full run-rate contribution in 2017.
– An onsite biogas facility brings twofold economic benefits; a new biogas revenue stream and reduced paper production costs. Furthermore, biogas is a renewable alternative to fossil fuels and forms part of the carbon solution. Moreover, biogas has large potentials in improving urban air quality, said Sven Ombudstvedt, President, and CEO of Norske Skog and chairman of the board of Norske Skog Saugbrugs in a statement.
AGA will be the main purchaser of biomethane from Saugbrugs. AGA has been supplying biomethane to heavy vehicles since 2008 and currently supplies 550 buses and trucks with biomethane from filling stations every day.
– The agreement with Norske Skog Saugbrugs represents a positive addition for renewable fuels in the county of Østfold, Norway. The volume of biogas covered by the agreement will be able to supply biomethane to a fleet of 70 heavy vehicles, said John Melby, Manager Clean Energy at AGA AS
Enova SF, a Norwegian funding agency owned by the Ministry of Petroleum and Energy charged with supporting the development of energy and climate technology has granted NOK 52 million (≈ EUR 5.56 million) in support to the project, while Sparebank 1 Gruppen and Halden Municipality’s pension fund has provided about NOK 100 million (≈ EUR 10.69 million) in debt financing.
– Bioenergy can play an important role in the transition to an environmental friendly transport sector, and availability of bioenergy must be increased. Therefore, we find it great that Norske Skog Saugbrugs will utilize sludge from paper production to produce biogas. Buses and refuse trucks in Østfold will now be able to use climate-friendly biogas made from waste products from Norske Skog. We wish to see more of this type of energy utilization. Hopefully, several other mills in the Norske Skog group will adopt similar solutions, said Audhild Kva, Marketing Director of Enova.
Plan to replicate rollout
Norske Skog plans to build biogas facilities at its paper mills, utilizing biowaste from the paper production process for renewable energy and is currently considering replicating the project at its other facilities. The investment in the biogas business will strengthen the entire mill site’s competitiveness and be part of Norske Skog’s efforts to improve operations at its remaining mill sites.
– We are planning to commercialize bio-waste from raw material into biomethane at our mills. Despite challenging markets, we believe that our mill sites are sustainable, and will strengthen their competitiveness by constructing biogas facilities. Our new growth area will be a new main business leg named Nature’s Flame, ended Sven Ombudstvedt.
About Norske Skog
Headquartered in Olso, Norway, Norske Skogindustrier ASA (Norske Skog) is one of the world’s largest producer of publication paper, with eight wholly and partly owned mills and sales offices and agents on five continents and annual sales of around NOK 12 billion (≈ EUR 1.28 billion).
The annual production capacity is around 2.9 million tonnes of newsprint, improved newsprint, Light Weight Coated (LWC), Super Calandered (SC) and directory paper.