The investment project of modernization of Segezha PPM is included in the list of priorities in the field of forest development

By order of the Minister of industry and trade of the Russian Federation Denis Manturov the investment project Segezha Group (part of AFK Sistema) – “Modernization of JSC Segezha PPM with increasing capacity for the production of sack paper” is included in the list of priority investment projects in the field of forest development. 

Order No. 114, which was signed by the Minister on 22 January 2019, Segezha Group gives the right to conclude lease agreements in the Republic of Karelia with the calculated wood-cutting area – 219,5 thousand m3. The increase in the estimated cutting area is a matter of raw material safety of the project and one of the effective tools for managing the cost of production. Segezha Group is the largest forest user in the European part of Russia, the total area of the leased forest Fund is 7.4 million hectares, 86% of which is certified according to international standards.

The justification for assigning the status of priority in the field of forest development to the Segezha pulp and paper mill modernization project was the implementation of a large – scale investment program in the period 2016-2018. In 2016, the plant replaced the fibrous line of the pulp plant-the No. 4 cooking plant was updated, which allowed raising the productivity of pulp cooking while saving energy and chemicals and to more effectively process wood raw materials. In 2017, at the Segezha PPM a unique papermaking machine BDM-11 of the Global Concern Voith was launched with a capacity of 110 thousand tons of sack paper a year. In 2018, a modern boiler plant was built on the bark and wood waste of the Finnish Corporation Valmet for the production of steam for the technological processes of the plant.

“Further modernization of Segezha pulp and paper mill is, on the one hand, an increase in volumes, on the other – an increase in the efficiency of all stages of production, – emphasized the President of the timber holding Mikhail Shamolin, – We have already invested more than 14 billion rubles in the development of the plant over the past few years. The modernization program continues, we plan to raise the PPM to the level of the best and newest foreign plants”. 

The new stage of the Segezha pulp and paper mill capacity renewal implies the increase of the enterprise productivity up to 600-700 thousand tons of paper per year. The amount for this reconstruction, according to the first estimate, is about 45-50 billion rubles.

The planned modernization will not only increase the volume of paper production at Segezha pulp and paper mill but also diversify the product portfolio of the Group, as well as use hardwood in the production. Hardwoods make up a quarter of the harvested wood in Karelia. After the implementation of the investment project, the plant will be able to produce commercial bleached softwood and hardwood pulp, as well as bleached paper, which opens up fundamentally new markets for the Group, because at the moment Segezha pulp and paper mill produces only unbleached Kraft paper made of softwood.
President of Segezha Group Mikhail Shamolin also noted that last year Segezha pulp and paper mill reached a record production volume-355 thousand tons of premium sack paper. For comparison, in 2014-2015 production did not exceed 260 thousand tons.

“There is almost no doubt that our investment program, implemented in the region, is mutually beneficial, – commented on the assignment of the project of modernization as a priority head of the Directorate for relations with state bodies of Segezha Group Nikolai Ivanov, – we are building a business in Karelia not only with good capitalization but also public reputation. Work in the interests of the state, corporations, and residents of the region is the basis of our strategy.”