Kruger investing $378 million to diversify two Quebec paper mills

September 11, 2017

By: The Working Forest Staff

SHERBROOKE and TROIS-RIVIÈRES, Que. – Kruger Inc. is will invest $377.6 million to diversify operations at its Brompton and Wayagamack Mills into specialty niches, such as flexible food packaging, labelling and digital printing. This major project, undertaken in partnership with the Government of Québec, will help to maintain more than 500 jobs in the Mauricie and Estrie regions, and will increase Kruger’s need for chips from sawmills.

Kruger and the Government of Québec have formed a partnership by which Investissement Québec, acting as the government’s agent, will grant loans and a loan guarantee totalling $59.8 million and acquire an equity participation of 37.5 per cent, or $44.6 million, in the new entity Kruger Specialty Papers Holding L.P. The new entity comprises the assets of the Brompton and Wayagamack Mills, as well as the biomass cogeneration plant adjacent to the Brompton Mill.

To carry out this diversification project, Kruger Specialty Papers Holding will invest $107.5 million over the next three years to enable the Brompton and Wayagamack Mills to gradually reduce the production of some publication paper products that are in decline, such as newsprint and magazine paper, while accessing new markets that are on the rise. Investments will be distributed as follows:

Wayagamack Mill: $32.9 million;

Brompton Mill: $47.5 million;

Trois-Rivières Mill: $22.3 million; and

Biomass Cogeneration Plant (Brompton): $4.8 million.

Another benefit of these projects is the need for an additional 100,000 metric tonnes of wood chips procured annually, which will have a direct positive impact on Quebec’s sawmill sector.

The mills’ diversification strategy ties in to the complementary operations at various Kruger sites, which is why the project calls for investments in the biomass cogeneration plant and in the thermo-mechanical pulp mill at the Trois-Rivières Mill, which will supply the Brompton and Wayagamack Mills with raw material.

The amounts invested will be used to acquire new production equipment, modify existing equipment, make technical improvements to boost productivity, and for various energy efficiency measures.

By the end of the project, the Brompton Mill will focus exclusively on specialty products and therefore will no longer manufacture 200,000 metric tonnes of newsprint annually.

The innovative specialty papers developed by Kruger will offer several competitive advantages, including the use of cellulose filaments (CF). This new-generation biomaterial is Kruger’s proprietary strengthening additive that is manufactured at the world’s first CF plant built by Kruger in Trois-Rivières in 2014.

Photo: Philippe Couillard, Quebec’s Premier and Julie Boulet, Minister of Tourism and Minister responsible for the Mauricie Region, during a visit to Kruger’s Wayagamack Mill. Courtesy of Kruger.

Your comments.

Your #1 source for forestry and forest industry news.

Built by Sofa Communications