Displaying items by tag: Fortress Paper

The Quebec Ministry of Transport planned to close Highway 148 at Thurso for at least part of the day Tuesday while Fortress Paper unloaded 100 tonnes of Finnish equipment that will be used to produce a type of pulp that can be used to make rayon.

Mill manager Marco Veilleux said the equipment arrived just before 8 a.m. after a trip by barge from Montreal along the Ottawa River. Veilleux said unloading was to start at 8 a.m. and would take at least a couple of hours. Highway 148 would be closed so the equipment can be moved by truck across the road.

Chinese customers have bought 78 per cent of the Thurso mill production even before it starts operation next summer. Fortress bought the mothballed Fraser Papers mill earlier this year and recalled workers to produce traditional pulp.

With their Thurso pulp mill in the midst of being converted to a dissolving pulp producer, Fortress Paper Ltd CEO Chadwick Wasilenkoff traveled to China last month to meet with potential buyers of their soon-to-be available new product. The region, he said, was a prime market for the dissolving pulp – a product used in the textile industry for the creation of rayon.

“The largest viscose producers (in the world) are expanding their capacity, but none of them have focused on a supply chain – where they’re going to get this rayon pulp,” Wasilenkoff said in an interview with Colorado radio station KRCN.

This week, Fortress Paper announced they had reached an agreement to supply dissolving pulp to two Chinese rayon producers.

As part of the agreement, Fortress will deliver a total of 84,000 air dried metric tons of dissolving pulp annually to the Chinese companies for a period of five years starting in the third quarter of 2011, when the Thurso mill is expected to be fully converted.

The mill expected to have a production capacity of more than 200,000 air dried metric tons of dissolving pulp annually.

Rayon is seeing a sizeable growth across the globe, especially in Asia. Currently rayon represents about four per cent of the textile industry but that number is growing. In China alone, the rayon market is growing at a rate of nearly ten per cent annually, and those numbers are only expected to increase as regulations on cotton and depleting supplies impact what used to be the textile industry’s go-to fibre.

Rayon is also gaining in popularity because while demand for cotton – the world’s most popular textile fibre – is steadily increasing, production of cotton is actually decreasing.

SOURCES:
Reuters: “Fortress Paper Gets Two Contracts In China”
Specialty Cellulose: “Fortress Paper Enters Into Dissolving Pulp Supply Agreements”

Fortress Paper Ltd. announces that it has increased the purchase commitments for its dissolving pulp to an aggregate of 156,000 air dried metric tonnes (“ADMT”) per annum representing approximately 78% of the Fortress Specialty Cellulose Mill’s planned annual production capacity.

Fortress Paper, through a wholly-owned subsidiary, entered into a dissolving pulp supply agreement with an additional producer of viscose fibre (rayon) products located in China, for the delivery of approximately 72,000 ADMT of dissolving pulp per annum at a purchase price based on a formula that factors in the prevailing market price of viscose staple fibre in China, subject to minimum pricing terms and no maximum purchase price. The pulp supply agreement is for a term of ten years, with Fortress commencing the supply of dissolving pulp in the third quarter of 2011.

The Company also announces that it has issued 400,000 common shares upon the partial conversion by Solidarity Fund QFL (Fonds de solidarite FTQ) (the “Fonds”) of $8,000,000 principal amount of its $15,000,000 unsecured convertible debenture that was issued on April 30, 2010.

Chadwick Wasilenkoff, Fortress Paper’s Chief Executive Officer, commented: “We are very pleased to be working with Solidarity Fund QFL (Fonds de solidarite FTQ) on this exciting project in the Province of Quebec where they are playing an important role in the Thurso project by providing early-stage capital to Fortress Paper. I would like to thank the Fonds for their support and I would welcome the opportunity to partner with them again in the future.”

“We were pleased to partner with Fortress Paper earlier this year. The Company’s turnaround plan is well underway. The Thurso plant is already running at a good pace, having called back some 300 employees,” said Gaetan Morin, Executive Vice-President, Investments, at Solidarity Fund QFL (Fonds de solidarite FTQ).

About Fortress Paper

Fortress Paper is a leading international producer of security and other specialty papers and products. Fortress operates three mills, the Landqart Mill located in Switzerland, the Dresden Mill located in Germany and the Fortress Specialty Cellulose Mill located in Quebec, Canada. Fortress Paper’s security papers include banknote, passport and visa papers and its specialty papers include non-woven wallpaper base products, and graphic and technical papers. Fortress Paper’s pulp business includes NBHK produced at the Fortress Specialty Cellulose Mill with plans to convert this capacity into dissolving pulp production along with the construction of a biomass based cogeneration plant.

Fortress Paper Ltd. ("Fortress Paper" or the "Corporation") announced today that it has signed, through its wholly-owned subsidiary, Fortress Specialty Cellulose Inc. ("FSC"), an Energy Supply Agreement (the "Agreement") with Hydro Québec for the sale of green electricity to be produced at the Thurso Mill upon completion of a biomass-based cogeneration facility.

Under the Agreement, the Company will construct a cogeneration facility to provide net 18.8 megawatts of green power to Hydro Québec over a 15 year term, with deliveries estimated to commence in the fourth quarter of 2012.

Chadwick Wasilenkoff, CEO of Fortress Paper, states, "The signing of the Agreement represents an important step in achieving our business plan at the Thurso Mill, which includes the building of a cogeneration plant that produces green electricity that in turn will ultimately benefit Québec residents. We believe that the results of this partnership with Hydro Québec will be beneficial to the environment and the economy of Québec, as well as providing net energy savings (income) to Fortress Paper."

The Agreement is subject to final approval by the Régie de l'énergie in Québec which is expected to be received in the third quarter of 2010.

Fortress Paper Ltd. a leading producer of security and specialty papers, in a major strategic move today announces the signing of an asset purchase agreement (“APA”) to acquire the assets of a northern bleached hardwood kraft manufacturing facility located in Thurso, Quebec from Fraser Papers Inc. with the intention to convert this operation into a world class, low cost, specialty cellulose (dissolving pulp) operation. Concurrently, Fortress Paper intends to build a biomass-based cogeneration plant at the Thurso Mill which will produce green electricity resulting in material net energy savings.

Upon closing of the acquisition of the Thurso Mill, which will be completed through its wholly-owned subsidiary Fortress Specialty Cellulose Inc, the Corporation intends to incur capital expenditures of approximately $153 million to convert the non-operating NBHK mill into a high quality specialty cellulose mill and to construct a new cogeneration facility. In connection with the proposed capital expenditures, Fortress Paper is pleased to announce that it has pre-arranged specific financing initiatives to fund the conversion and cogeneration projects.

The specialty cellulose mill is planned to have an annual production capacity of more than 200,000 air dried metric tonnes and is expected to be completed in mid-2011. In entering into the specialty cellulose sector, Fortress Specialty will focus on producing dissolving grade cellulose for the textile industry, primarily targeting viscose fibre (rayon) products which have shown strong growth of approximately 10% in China and 7% worldwide over the past five years. Rayon is a technically evolved and versatile fibre with many advantages, particularly in the warmer and higher growth regions of the world.