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Domsjö Fabriker makes further investments in biorefinery in Sweden

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Domsjö Fabriker makes further investments in biorefinery in Sweden

December 17, 2010 - 00:33
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ORNSKOLDSVIK, Sweden, Dec. 17, 2010 (Press Release) -The Board of Directors of Domsjö Fabriker has decided on further investments in the biorefinery as part of the development program Domsjö 2012, which aims at increasing specialty cellulose capacity to 255 000 tonnes per year.

"It is important that we maintain our leading position and are able to grow with our customers. Therefore, we are developing the biorefinery in Örnsköldsvik, Sweden while we at the same time are investigating other opportunities such as business acquisitions", says CEO Ola Hildingsson.

The decision means that an additional SEK 280 million will be invested in Domsjö in 2011.

The investments are part of the ongoing development program Domsjö 2012. Earlier this year investment decisions amounting to SEK 300 million were made within this development program. Investments in a new lignin dryer and a new debarking facility were decided.

As a result of the development program, our cellulose capacity will increase from approximately 200 000 tonnes at present to 255 000 tonnes per year. This allows us to grow with our customers in the expanding textile market and we wish to expand as soon as possible, adds Ola Hildingsson.

A part from increasing capacity, we are investing to improve the value of our product portfolio by increasing resources in our development department, DomInnova.

Domsjö specialty cellulose is mainly used for viscose textiles. This is a market with strong growth. One reason for this market expansion is a decline in cotton production while demand for natural fibers are increasing, and viscose is the natural alternative.

Parallel to the development of the biorefinery in Örnsköldsvik, we are exploring opportunities to strengthen our position on the growing market for specialty cellulose. One option would be to convert an existing sulfate pulp mills in Scandinavia. However, this is complicated and expensive. Another option we are evaluating is to start producing specialty cellulose in South America. Nothing is decided yet, concludes CEO Ola Hildingsson.