Segezha Group reviewed the priority of building new pulp and paper mills in Karelia and the Krasnoyarsk Region

Elena Romanova, Head of Investor Relations at Segezha Group, said at Smartlab Conference that Segezha Group had reviewed the priority of projects on launching new pulp and paper mills in Karelia (Segezha West) and the Krasnoyarsk Region (Segezha East), as reported by Interfax. As timber products can no longer be supplied to the EU and have to be re-routed to eastern export markets, the Group decided to focus on its Siberian project instead. Ms. Romanova noted that the implementation of the Segezha West project is currently very doubtful due to problems with equipment supplies and the plant’s remoteness from eastern sales markets.

Segezha Group was going to begin construction of a pulp and paper mill in Karelia in 2022. The commissioning was scheduled for early 2025, whereupon the Group was planning to start the implementation of the Segezha East project. The company’s plans were disrupted by the sanctions pressure from western countries. Specifically, the European Commission introduced the eighth package of sanctions that banned import of wood pulp and paper from Russia.

The project of building a pulp and paper mill in the Krasnoyarsk Region accordingly became a priority because of the cheap pulp wood in Siberia and the proximity to China, the key sales market.

Segezha is planning to install Chinese equipment at the plant, which, in turn, will limit the production capacity to 0.8 – 1 million t per year. The Segezha East project previously featured equipment capable of producing 2 million t of wood pulp per year.