Global forest industry major Stora Enso Oyj has announced that it has decided to commence a feasibility study and environmental permit application process on enhancing and expanding the pulp- and board-making capabilities at its Skoghall Mill in Sweden. The investment would leverage the already "strong mill" into an "integrated, highly cost-competitive, and environmentally-friendly" producer of packaging board and bleached softwood market pulp.
According to a statement, the findings of a recently completed pre-feasibility study supported the continuation of the investment process of which the impending feasibility study and environmental permit application process are the next steps.
The feasibility study will evaluate a possible upgrade and expansion of existing integrated pulp capacity from 370 000 tonnes to 780 000 tonnes annually and a possible increase of 120 000 tonnes of board capacity.
Currently, Skoghall Mill has an annual production capacity of 885 000 tonnes of packaging board. After the investment, the mill would be integrated close to 100 percent, with an additional 220 000 tonnes of softwood market pulp.
This would enable a further increase in cost-competitive board production. The project would also significantly lower the fossil CO2 emissions of production. The investment would serve customers globally and further establish Stora Enso as a provider of high-quality, renewable packaging materials.
The feasibility study is expected to be completed by the end of 2021. If the investment is approved following the feasibility study and environmental permit application process, the capital expenditure for the upgrade and expansion is estimated to be approximately EUR 800–850 million. Production would start earliest in Q4/2023.
Skoghall Mill is one of our core integrated platforms for packaging materials. The investment would allow us to grow and be more flexible in serving our customers and meet the increasing demand for sustainable packaging among consumers. The investment would be in line with our strategy to accelerate growth in the packaging business as well as to develop the competitiveness of our mills based on economies of scale and integration benefits. It would also bolster the potential of profitable growth in attractive packaging end-use segments, such as liquid packaging board and coated unbleached kraft. The possible decision regarding an expansion of Skoghall Mill will be made once the feasibility study has been completed and pending the outcome of the environmental permit application process with local authorities, said Hannu Kasurinen, EVP, Stora Enso’s Packaging Materials division.