Borregaard: New lignin operation in Florida in final phase of approval

Borregaard and Rayonier Advanced Materials (RYAM) have concluded a market, technical and engineering analysis regarding a new lignin operation at RYAM's Fernandina Beach site in Florida to serve the growing demand for natural lignin-based products. The final review of the investment by the companies' boards of directors is anticipated during the second half of 2016 upon receipt of final permits and incentives from government entities. If the companies elect to proceed, operations are expected to commence approximately 18 months later.

Cost of construction of the lignin plant is expected to be USD 135 million over two phases of the project. Phase one, which will have a lignin capacity of 100,000 metric tonnes dry substance, is estimated to cost USD 110 million. An estimated incremental USD 25 million will be required in phase two to increase the total capacity to 150,000 metric tonnes dry substance. LignoTech Florida intends to access the debt markets to fund a portion of the capital requirements.

The new company, LignoTech Florida LLC, is to be owned 55% by Borregaard and 45% by RYAM. 

For background information see also the stock exchange notices of 17 December 2015 and 1 June 2015.

Sarpsborg, 28 June 2016

Jørn Syvertsen, Director Investor Relations, +47 958 36 335

This information is subject to the disclosure requirements pursuant to Section 5-12 of the Norwegian Securities Trading Act.