Demand for sustainable eucalyptus pulp continues to grow and UPM is looking for opportunites to grow in pulp business. This is why UPM and the Government of Uruguay have agreed on the fundamentals for a potential new pulp mill investment in central Uruguay.
The Investment Agreement, signed 7 November 2017, defines the requirements for the operating environment of a world-class pulp mill project. It details the roles, commitments and time-line for both parties as well as the relevant items to be agreed prior to UPM's final investment decision.
If all goes to plan, Uruguay could be a competitive alternative for UPM to address the global pulp market opportunities in the 2020s.
Petri Hakanen appointed SVP, UPM Uruguay Development Project
(UPM, Helsinki, 1 December 2017 at 08:30 EET) - Petri Hakanen has been appointed Senior Vice President, UPM Uruguay Development Project, starting from 1 March 2018. Currently he works as SVP, UPM Specialty Papers ENA. Jaakko Sarantola , the curren...Press Release Nov 07 2017
UPM and the Government of Uruguay sign an investment agreement to establish a competitive operating platform
(UPM, Helsinki/Montevideo 8 November 2017 at 00:15 EET) - UPM and the Government of Uruguay have signed an investment agreement, which outlines the local prerequisites for a potential pulp mill investment. The agreement details the roles,...Press Release Nov 01 2017
UPM's negotiations with the Government of Uruguay concluded
(UPM, Montevideo, 1 November 2017 at 09:00 GMT -3.00) – The discussions between UPM and the Government of Uruguay concerning the infrastructure development and other local prerequisites for long-term industrial growth in Uruguay have been...Press Release May 04 2017
Discussions with the Government of Uruguay progressing - key items aligned
(UPM, Helsinki, 4 May 2017 at 01:00 EET) - "Good progress has been made in the discussions between the Government of Uruguay and UPM concerning the infrastructure development and other local prerequisites for long-term industrial growth in Uruguay...
Impacts of a potential new pulp mill to Uruguay
The indicative figures are based on the study 'Economic Impact of UPM’s Operations in Uruguay' by CPA Ferrere, May 2016
8,000 new jobs
MUSD 200 in salaries
MUSD 120 tax collection
Exports of MUSD 1,100
Permanent increase of approx.
Impacts to central and north-eastern region
Training and education
New skills and opportunities
practical and sustainable actions
Infrastructure development as an enabler
Robust infrastructure is the foundation for industrial development. The Government of Uruguay will develop the country’s inland rail and road network that will enable new business opportunities, such as cost-efficient transportation of pulp, grain, wood products and containers.
Often considered the safest and most environmentally friendly form of heavy transport, railway offers a competitive alternative for all its users.
UPM’s products would provide the base volume for the rail. Like all users, UPM would pay for the use of the railway.
- Improvements and maintenance to allow year-round use
- Efficient wood transportation with combined high performance vehicles
- Modernisation to meet the latest standards
- Accessible for public and private operators
- Deep sea port of Montevideo to be suitable for fully loaded ocean vessels
- Railway connection to the port
Creating permanent positive impact with a new pulp mill
Current UPM operations
UPM's potential state-of-the-art pulp mill
EUR 2 billion
2 million tonnes
The preliminary investment estimate for the pulp mill construction on site is EUR 2 billion.
The single line pulp mill with proven environmental performance and best available techniques (BAT) would have a production capacity of approx. 2 million tonnes of eucalyptus market pulp annually. This would make it the largest single line pulp mill in the world.
The pulp mill would be located in the department of Durazno on the southern side of the river Rio Negro, 4–5 km downstream from the city of Paso de los Toros and Centenario village.
The location is subject to the regulatory approvals from the various agencies involved, and the socio-economic and environmental impact assessments.
In addition to the initial on-site investment, a successful project requires off-site investments
- Plantation land, forestry, nursery capacity
- Harvesting and transport equipment
- Road network for forestry operations
- Wood transportation contractor network
- Rolling stock for rail
- Electricity infrastructure
- Export facilities
Establishing a competitive operating platform in Uruguay – next steps
UPM’s process for the possible new pulp mill consist of three phases.
The second preparation phase consists of three gates for the implementation of the IA.
Following graph is showing the status of the implementation of the IA
The content is based on the IA and mainly Annex 2
Each arrow describe main actions
Implementation is described by colours:
Yellow: in progress
Grey: not started
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