Changes at Kawerau's Norske Skog paper mill amid ongoing review

Monday, 1 February 2021

Kawerau’s Tasman paper mill has started making paper for packaging as its Norwegian owner prepares to halt newsprint production at the site.

The mill, owned by forest products company Norske Skog, began making the paper for supply to markets in Asia last month.

Norske Skog announced a review of operations at the mill, which employs more than 160 people, in October last year.

Due to the “rapid, negative and likely irreversible” impact of Covid-19 on the newsprint industry, the company was looking at alternative long term options for the site.

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The Tasman newsprint mill at Kawerau, with wetlands and thermal power station in the foreground. The mill has started making paper for packaging products as its owners prepare to halt newsprint production.

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Those included making bleached chemical pulp, but the company was considering “all options”.

A spokesman at the company’s head office in Norway said the review is expected to be completed in the early part of this year. No job losses have been identified to date.

“Norske Skog do not intend to make products other than converting grade paper and mechanical pulp on reel,” he said.

“Newsprint production at the Tasman Mill is expected to finish during the first quarter of 2021.”

A request for comment from Norske Skog Tasman was declined.

The “pulp on reel” product is made by drying mechanical pulp, based on roundwood and sawmill chips, through the paper machine.

It can then be used to make container board for packaging, or re-pulped.

The Tasman mill produces about 150,000 tonnes of newsprint per year.

Using existing infrastructure, process and employees, and with little other investment, it could make about 200,000 tonnes of paper as pulp on reel Norske Skog chief executive Sven Ombudstvedt said in a statement.

As the Tasman mill is the only newsprint production site in New Zealand, the change will mean some publishers have to import paper.

Stuff chief financial officer and operations director Ramesh Vedachalam said the media company is working with the Newspaper Publishers’ Association and Norske Skog to ensure it has certainty around supply of newspaper products.

As well as the Tasman mill, Norske Skog owns four mills in Europe and one in Australia.

In 2019, the company sold its Albury newsprint facility in New South Wales, citing falling demand for newsprint.

The Albury mill was able to produce up to 265,000 tonnes of the paper each year.