During a press conference held today, Sven Ombudstvedt (CEO) and Tore Hansesætre (SVP Strategic Projects) of Norske Skog announced that the company will enter the packaging market by 2023. This will be done by converting PM1 at the Golbey mill (France) and PM3 at the Bruck plant (Austria) to containerboard production. The company will enter the top ten producers of this sort.
At the Golbey mill in France, approximately EUR 250 million is planned to be invested to convert PM1 from its current 235,000 tonnes of newsprint capacity to 555,000 tonnes of recycled containerboard capacity. Following the conversion in 2023, Golbey will have 555,000 tonnes of recycled containerboard capacity and 330,000 tonnes of newsprint capacity. At the Bruck mill in Austria, approximately EUR 90 million is planned to be invested to convert PM3 from its current 125,000 tonnes of newsprint capacity to 210,000 tonnes of recycled containerboard capacity. Following the conversion in 2023, Bruck will have 210,000 tonnes of recycled containerboard capacity and 265,000 tonnes of light-weight coated magazine capacity.
These projects are said to secure the long term future of the sites and the jobs that go with.
The conversions will introduce 765,000 tonnes of containerboard capacity to meet the demand for renewable packaging. Following the conversions, both mills will have access to green energy and have reduced their carbon footprints to become among the best performers in the industry. Norske Skog will continue to be a supplier of all publication paper grades after the planned conversions. Newsprint capacity will be reduced with 360,000 tonnes, balancing the market for the Norske Skog’s remaining European publication paper capacity.
Final investment decisions are planned in the first half of 2021, and start of containerboard production in the first half of 2023. Production standstill at the machines that will be converted is limited to three months during the final stages of the conversions, and full utilisation is expected by the end of 2025.
“Increased focus on sustainable packaging, and growth in on-line economy are key market drivers in the packaging business. With the conversion investments in Golbey and Bruck, we will meet these trends with cost-leading capacity. Both mills are positioned close to the consumer markets of containerboard in continental Europe, have established access to recycled fibre, and represent some of the best brownfield conversion opportunities in the market.” says Norske Skog’s CEO Sven Ombudstvedt.