Arkhangelsk PPM officially submitted a new investment project at the cost of 105 billion rubles to the Ministry of Russian Federation for Far East and Arctic Development

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Pulp Mill Holding intends to invest more than 160 billion rubles in the modernization of its Russian production facilities.

The priority of the strategic agenda of the holding activity will be a new large-scale investment project – construction of a new sulfate board plant (4th line) with the third board machine (BM-3) with the capacity of 700 thousand tons per year. The plant will meet all world requirement and will be built at the site of Arkhangelsk PPM.

According to Vladimir Krupchak, Investment Director of PMH, Arkhangelsk PPM is the leader in the production of high-quality containerboard with stable buyers and a wide market. The existing capacity of the two board machines is more than 600 thousand tons per year. The new BM-3 will focus on growing foreign markets: the demand for board is expected to double by 2050 in the world.

“The project "BREAKTHROUGH of 2027" will allow us to increase EBITDA, ensure growth of the APPM's capitalization and certainly improve the environmental situation in the north of the region through the further implementation of the best available technologies,” – said Vladimir Krupchak.

In five years, APPM will increase annual pulp cooking up to 1,700,000 tons and containerboard production up to 1,300,000 tons.

Vladimir Krupchak also emphasized that the logic of vertically integrated structure, where Arkhangelsk Pulp and Paper Mill is the anchor enterprise, is the maximum use of all components of the wood, including its energy resources. Estimated logging area of Arkhangelsk PPM’s general supplier - Titan Group of Companies - will increase by 6 million m3 up to 11 million m3 with the commissioning of the new board plant. The holding will supply the mill with 2.6 million m3 of logs and Sawmill-25 CJSC will supply the mill with 3.3 million m3 of sawn timber. Therefore, Titan Holding will build a new sawmill and pellet plant with an annual capacity of 2 million m3 on the site of Sawmill-25 CJSC. Thus, in 2027, the volume of sawn wood production will increase up to 1,700 thousand m3, pellet - up to 400 thousand m3, wood chips - up to 1,200 thousand m3.

With the increase in the volume of harvesting, the area of forest restoration will increase at least twice from the existing volume (from 19 to 38 thousand hectares). This will require more planting material, including with closed root system.

At present time Arkhangelsk Pulp and Paper Mill is designing a forest nursery garden in Novodvinsk for growing seedlings with closed root system with capacity of 3,7 million pieces with further increase up to 9 million pieces. This forest nursery garden will provide the planting material for forest regeneration works in the northern part of Arkhangelsk region.

The project “BREAKTHROUGH of 2027” was officially submitted to the delegation of the Ministry of Russian Federation for Far East and Arctic Development and Far East Development Corporation JSC during its two-day visit to Arkhangelsk PPM.

In particular, the representatives of the departments visited the facilities’ sites of the future production complex, which assumes the production of high yield softwood pulp and hardwood semi-chemical pulp, recycled pulp mill, BM-3, evaporator plant, multi-fuel and recovery boilers.

As detailed by Dmitry Zyliov, CEO of Arkhangelsk Pulp and Paper Mill, the project "BREAKTHROUGH-2027" will create about 400 new jobs at the mill, the average monthly salary will be increased up to 100 thousand rubles per person. Tax payments to all levels budgets will increase to 4.3 billion rubles.

The growth of investments is expected: socially responsible programs (600 million rubles), environmental protection measures (2.5 billion rubles), measures to improve labor conditions and safety (200 million rubles) and charity and sponsor support (130 million rubles).

Dmitry Zyliov highlighted the multiplicative effect of the project implementation for the economy of the North-West of Russia: cluster implementation of BREAKTHROUGH-2027 will allow developing not only port capacity of the Arkhangelsk region, regional added-value wood processing and contiguous business structures.

For example, about 5000 people will be involved in construction of a new production complex at Arkhangelsk Pulp and Paper Mill. It is planned to build a comfortable settlement in the town for them. When the construction is completed, the apartments will be given to the people who will be relocated from the emergency housing.

“Our project will also expand regional maritime logistics: export flows to Asia will create the need for regular liner traffic through the Northern Sea Route around Chukotka and Kamchatka,” – said CEO of Arkhangelsk PPM.

During two-day visit, the parties discussed the difficulties of the project. In particular, the supply of the new APPM production facility with wood raw materials. By common opinion, coordination of interregional relations and, therefore, the support of the Arkhangelsk regional administration will be required for this purpose.

"The projects which were implemented at Arkhangelsk Pulp and Paper Mill for the last 12-15 years have always found support from the state, - said Dmitry Zyliov. Earlier we talked to Alexander Tsybulskiy, Governor of the region, saying that all funds allocated to the mill in the form of various allowances have already been returned to the state and this means that the budget efficiency of our investments is extremely high.

CEO of APPM also reminded that the mill is the most northern pulp and paper mill both in the Russian Federation and in Europe, unequivocally belongs to the Arctic zone, so it should get the status of a resident with a corresponding package of benefits.

Source: Arkhangelsk PPM