Pulp and Paper Canada

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STRONGER market conditions reflected in mill SPENDING;


June 1, 2000
By Pulp & Paper Canada

Our annual capital spending survey of the Canadian pulp and paper industry reflects a sector with an optimistic and competitive approach. Costs for modernization and improvement projects for mill prod…

Our annual capital spending survey of the Canadian pulp and paper industry reflects a sector with an optimistic and competitive approach. Costs for modernization and improvement projects for mill production facilities, pollution control and energy conservation top $1.91 billion, a conspicuous 203% of last year’s spending. Expenditures signed, sealed and delivered in 2000 are similarly notable, at $942 million they are 221% of last year’s outlay.

The numbers are boosted by the return to our survey of a few big players. Abitibi-Consolidated, Fletcher Challenge Canada and St. Laurent Paperboard, all absent from last year’s survey, will be injecting a combined total of $495 million into their respective facilities.

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The boost also comes from undertakings unparalleled in last year’s survey. Weyerhaeuser’s modest previous report is well surpassed this year. The company will be spending $133 million to optimize mill production and pollution control. The Specialty Cellulose Division of Tembec will modernize the sulphite mill at a cost of $130 million, and Alliance will finish the installation of its new PM4 at Donnacona, spending $121 million this year.

These projects and others brings mill production facilities’ spending to $1.71 billion, double the $858 million reported in last year’s survey. For the year 2000, at $879 million, projected spending is 223% of 1999, which was $395 million.

The industry will put $56 million more into pollution control, spending $129 million. Weyerhaeuser’s $40 million optimization project boosts the numbers. Thirty seven percent of the total will be spent in 2000, amounting to $48 million.

Energy conservation projects have increased in focus over the year. An impressive $69.2 million will be spent on such projects as cogeneration, heat recovery and steam control, compared to $3.66 million last year. The 2000 allotment at $29.2 million is more than 10 times its 1999 corollary of $2.79 million.

Please note that Crestbrook, Spruce Falls, Pine Falls, and AV Cell are Tembec companies and are listed as such. The Cascades listing includes Dsencrage CMD and Fjordcell and Kruger’s entry incorporates Corner Brook Pulp and Paper.

TABLE I. Total capital spending summary, company by company ($, 000).

Total2000 allotment
Abitibi-Consolidated372 575135 238
Alberta Newsprint41904190
Alberta Pacific80758071
Alliance Forest260 580134 680
Canfor19 34513 475
Cascades61374671
Celgar91508440
Daishowa23 90017 100
Domtar108 58076 680
Fibreco25 80019 000
Fletcher Challenge Canada22900944
Kimberly-Clark Nova Scotia25352435
Kruger71 25062 795
Marathon Pulp52675267
Minas Basin750750
Norampac26 66519 215
Papier Masson162 730103 730
Paperboard Industries46502300
Pope & Talbot66665996
Quesnel River59444298
St. Anne-Nackawic97285878
St. Laurent Paperboard99 70075 700
Stora Enso14 60011 100
Tembec486 570173 562
Tolko Manitoba142001013
Weyerhaeuser133 00037 000
Total1 905 487941 968

Companies not listed above either have no capital expenditures or did not return the survey.

TABLE II. Total capital spending of each company by category ($, 000).

MillPollutionEnergy
productioncontrolconservation

CompanyTotal2000Total2000Total2000

Abitibi-

Consolidated361 269131 22611 306401200
Alberta Newsprint3800380039039000
Alberta Pacific75537549370370152152
Alliance Forest260 200134 300270270110110
Canfor482546257360452571604325
Cascades51603694857857120120
Celgar8900819025025000
Daishowa23 90017 1000000
Domtar100 20075 10081001300280280
Fibreco6800650019 0001250000

Fletcher Challenge

Canada2130018400001600760

Kimberly-Clark

Nova Scotia2000200053543500
Kruger70 30062 03500950760
Marathon Pulp23992399292928392839
Minas Basin7507500000
Norampac23 16515 715N/A350000
Papier Masson162 730103 7300000

Paperboard

Industries465023000000
Pope & Talbot4532412746039216741477
Quesnel River3832218619621962150150
St. Anne-Nackawic489340534835182500

St. Laurent

Paperboard85 00066 00010 100510046004600
Stora Enso13 80010 300300300500500
Tembec418 751151 10218 894943548 92513 025
Tolko Manitoba13 2304630860860110110
Weyerhaeuser93 00037 00040 000000
Total1 706 939878 811129 37848 31269 17029 208


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