Paper renaissance: $270 million expansion planned for Tenn. paper mill

June 3, 2015

By: Times Free Press

A few years ago, the future of the Resolute Forest Products pulp and paper mill here was shaky as it grappled with a downturn in business.

But on Monday, company officials said they plan to invest $270 million in a major expansion at the mill, the second in a year, and hire 105 more workers.

For the first time in the plant’s 61 years, and in company history, Resolute will make a product — tissue for paper towels and toilet paper — that will go directly to the consumer market.

“This is a big day for Resolute. It’s a big day for the mill,” said Richard Garneau, chief executive of the Montreal-based company whose local plant was known for many years as Bowater.

Garneau said the expansion will make, box and package the tissue products for private label retailers. Companies such as Wal-Mart and CVS, for example, each have their own specifications for such products, he said.

“It’s a new chapter in the history of our company and this mill,” Garneau said.

The expansion is the largest investment made by Resolute companywide since 2010 and the largest at the plant in decades, officials said.

Robert Martin, general manager of the sprawling McMinn County factory on Highway 11, said work on the expansion is to start this summer and be ready in the first quarter of 2017.

Hiring of the project team will start soon, while the plant will staff up for the expansion as needed. Workers will earn from $17 to $29 per hour, Martin said.

A training grant will go to Resolute for its workforce, said Sam Wills, regional director for the Tennessee Department of Economic and Community Development.

“It was a competitive project. It was international,” he said, noting Resolute has 40 mills.

Kathy Price, who directs the McMinn County Development Authority, said diversification at the plant is key to its future.

“They had to reinvent themselves,” she said. Price said McMinn County is providing property tax incentives for the project, though the company is paying the education portion.

Last summer, ResoluteĀ unveiled a $105 million expansionthat’s related to Monday’s announcement, officials said. That work now underway involves installation of a 220-foot-high pulp digester, or cooker, and other wood-chip processing equipment.

It will permit the Resolute plant to get into new grades of paper, officials said, and make better specialty and commercial paper products.

“With the better quality, with the premium quality pulp we’re going to have, it’s going to help make our premium tissue,” Garneau said.

The factory was founded as one of the South’s first newsprint mills. The plant diversified extensively into advertisements, fliers and high-grade paper publications, though it still makes newsprint.

With the expansion announced Monday, Garneau said Resolute’s state-of-the-art equipment will have capacity to make 60,000 metric tons per year of at-home, premium bath tissue and towels, focused on the growing private label market, the CEO said.

“We’ll make sure we have the strength to meet consumer demand,” he said.

Officials said 40 percent of new production will go into paper towels and 60 percent into toilet paper.

McMinn County Mayor John Gentry said the expansion is taking Resolute into an exciting growth path in a new market. He said last year’s expansion brought about 50 new jobs. Together with Monday’s announcement, the new jobs total about 155.

“I’m excited for those 155 families,” he said. “You make careers here.”

Resolute Forest Products was formerly known as AbitibiBowater Inc., which was created by the merger of Bowater and Abitibi-Consolidated in 2007.

In 2009, the company filed for bankruptcy protection. AbitibiBowater emerged from creditor protection in 2010 and changed its name to Resolute in late 2011.

By: Times Free Press

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