International Paper Gives Engineering Firm Green Light on $100 Million Paper Machine Conversion Project

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Researched by Industrialinfo.com (Industrial Information Resources, Incorporated; Houston, Texas). Paper and forest products industry giant, International Paper (NYSE:IP) (Stamford, Connecticut), is advancing the development of a capital project to convert paper production at a mill in Pensacola, Florida from uncoated paper to brown lightweight linerboard. Though the project does not have full funding approval by the company’s board of directors, IP’s project team has released Jacobs Engineering (NYSE:JEC) (Greenville, South Carolina) to proceed with detailed design engineering. Final approval of the $100 million capital investment could be granted by the end of the year.

Key elements of the project include conversion of the No. 5 paper machine and upgrades to the pulp mill. The No. 5 machine, a Beloit fourdrinier with a Converflo headbox, will get a mini-fourdrinier and new stock preparation equipment in addition to reusing process equipment from the No. 3 paper machine stock prep area. On the dry end of the machine, IP plans to add ten new dryers, remove the size press and fourth press plus other minor improvements. In the pulp mill, IP plans to install new refiners and screens, along with extensive process piping reconfigurations.

Preliminary prep work will occur during multiple machine shutdowns throughout 2006 and will be followed by a 45-day major shutdown to install major equipment and tie-ins in March of 2007.

The P5 conversion project is the result of a corporate restructuring plan that calls for the company to focus on two key platform businesses, uncoated papers and packaging, while reducing uncoated free-sheet papers. This past spring, the mill permanently shut its No. 3 paper machine that produced 350,000 tons per year of uncoated free-sheet paper. Once at full production, IP anticipates production of lightweight linerboard on the P5 machine to be around 500,000 tons per year.

The Cantonment mill, located approximately eight miles north of Pensacola, has been in operation since 1940 and employs 700 workers at the site.

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