STORA ENSO OYJ Stock Exchange Release 11 December 2003 at 09.00
Stora Enso gives final approval to investments at Kvarnsveden
Stora Enso's Board of Directors at its meeting on 10 December
2003 approved the plans for building a new paper machine at
Kvarnsveden, Sweden, initially announced on 25 October 2002 as
part the Asset Restructuring Programme, and for major
improvement of energy efficiency at Skoghall Board Mill, Sweden.
The investments at Kvarnsveden and Skoghall fall within Stora
Enso's target of keeping capital expenditure at or below the
level of depreciation over the cycle.
The purpose of the Asset Restructuring Programme is to increase
the overall competitiveness of Stora Enso's assets, which
include about a hundred production units, whilst meeting the
growing quality demands of its customers. The plan includes
targeted investments, machine specialisation measures and
elimination of less-competitive production assets.
Stora Enso will build a new paper machine at Kvarnsveden Mill in
Sweden to improve its competitiveness in uncoated magazine paper
production. The total investment is estimated at approximately
EUR 450 million, and the aim is that the investment cost per
tonne should be below EUR 1 000. The annual production capacity
of the machine will be about 420 000 tonnes of high-quality
super-calendered (SC) papers. The machine is expected to start
up at the end of 2005. Paper machine 9 at Kvarnsveden Mill,
which has an annual capacity of 130 000 tonnes of improved
newsprint, will be shut down when the new SC machine starts up.
The investment will significantly enhance cost efficiency and
strengthen Stora Enso's position in the growing and profitable
SC paper market.
The Asset Restructuring Programme also includes other
investments in uncoated magazine paper. Paper machine 6 at Maxau
Mill in Germany will be rebuilt to enhance its productivity and
competitiveness. That machine produces SC-B paper made from
When the new paper machine at Kvarnsveden has started up, paper
machine 3 at Langerbrugge Mill, which has an annual capacity of
165 000 tonnes, will change from making mainly high-quality SC
to exclusively SC-B paper. This will allow Langerbrugge to
maximise the usage of recycled fibre.
In addition, the Group will cease non-competitive production of
SC paper on paper machine 5 at Wolfsheck Mill in Germany when
the new machine at Kvarnsveden starts-up. The Group is
investigating options for paper machine 5 at Wolfsheck Mill, but
it will not continue in production within the Publication Paper
division. The mill currently has two paper machines producing
some 150 000 tonnes of high-quality SC paper and wallpaper base
annually. The mill will be further developed within Stora Enso.
The projects approved will, as previously announced, increase
the Group's annual capacity in high-quality SC paper by around
200 000 tonnes net in the five-year period 2005-2010.
Skoghall Mill's Energy 2005 investment project aims to secure
the future base for board production and strengthen the mill's
energy supply. This will enable cost-effective production with
low emissions in both the short and long term. The project
includes a new recovery boiler area, evaporation plant and
conversion of an oil boiler into a biofuel boiler. The new
evaporation plant and recovery boiler will start up in autumn
2005 and the biofuel boiler in summer 2006. Project
implementation will begin immediately.
The total investment will amount to EUR 211 million. The
investment will reduce the oil consumption of the mill by some
60 000 cubic metres annually and increase electricity self-
sufficiency from 15% to about 40%.
For further information, please contact:
Bernd Rettig, Senior Executive Vice President, Stora Enso
Publication Papers, tel. +49 211 581 2310
Pekka Laaksonen, Senior Executive Vice President, Stora Enso
Packaging Products, tel. +358 2046 21218
Yngve Stade, Senior Executive Vice President, Corporate Support,
tel. +46 8 613 66 60
Esko Mäkeläinen, Chief Financial Officer,
tel. +44 20 7016 3115
Kari Vainio, Executive Vice President, Corporate
Communications, tel. +44 7799 348 197
Keith B Russell, Senior Vice President, Investor Relations,
tel. +44 20 7016 3146
Lars-Ove Staff, Mill Manager, Kvarnsveden Mill,
tel. +46 243 650 01
Ulf Eliasson, Mill Manager, Skoghall Mill, tel. +46 54 514350
Kvarnsveden Mill is a paper mill located in central Sweden. It
has an annual production capacity of approximately 670 000
tonnes of newsprint, improved newsprint and uncoated magazine
(SC) paper on four paper machines. Kvarnsveden Mill is part of
Stora Enso's Paper Product Area.
Skoghall Mill is a producer of cartonboard for consumer
packaging and printing, especially liquid packaging board, board
for dry foodstuffs and liner. The mill is an integrated
operation based on renewable raw materials that can be recycled
or used as fuel. It has an annual production capacity of 650 000
tonnes of cartonboard, such as folding boxboard (FBB), liquid
packaging board (LPB) and white top liner (WTL) on two machines.
Skoghall Mill is part of Stora Enso's Packaging Product Area.
STORA ENSO OYJ
Jyrki Kurkinen Ulla Paajanen-Sainio