Finland-based pulp and paper manufacturer Stora Enso is set to launch a two-phase integrated mill project in Guangxi, China, in order to accelerate access to the growing Chinese market.
Approval was given for the project by the Chinese National Development and Reform Commission (NDRC).
Captial expenditure for the first phase is estimated to be €760m, around €590m for industry and €170m for plant operations.
The breakdown is approximately €90m in 2013, €300m in 2014, €300m in 2015 and €70m in 2016 or soon after.
The project will commence initially with the building of a consumer board machine scheduled to be operational in the beginning of 2016.
Stora Enso renewable packaging division head Mats Nordlander said: "The revised investment schedule will cut the mid-term three-year capital expenditure requirements by half, as capital will be committed for the pulp mill only when the board machine is already generating cash flow."
Delay in the construction of the pulp mill is also expected to give an additional three years to the company to build up its fibre base and sustainable plantation operations with support from local communities and stakeholders.
"We are very excited to have a solid plan for finally going forward with the investment, which will produce sustainable and hygienic food packaging solutions for Chinese consumers," Nordlander added.
Image: Stora Enso will launch its integrated mill project in Guangxi, China in two phases. Photo: courtesy of Stora Enso.