This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
See Cramer's multi-million dollar portfolio for FREE and get his new book Get Rich Carefully! Learn More

Mercer International Inc. Completes Preliminary Feasibility Analysis To Enhance Its Mills To Be Able To Adjust Some Production From NBSK To Dissolving Pulp To Opportunistically Realize Upon Market Conditions

NEW YORK, Feb. 22, 2011 (GLOBE NEWSWIRE) -- Mercer International Inc. (Nasdaq:MERC) (TSX:MRI-U) (the "Company") today announced that it has completed a preliminary feasibility analysis for its Celgar and Stendal mills with respect to enhancing their operations and margins. In addition to other enhancements, the preliminary analysis identified that, for a capital cost of approximately $30 to $40 million per mill, they could have the capacity to produce NBSK pulp, as currently, and dissolving pulp ("DP") when market conditions are favourable. The enhancements would permit the mills to become "swing mills", capable of swinging production from NBSK pulp to DP to opportunistically maximize realizations. DP is a high grade specialty product that commands premium pricing relative to NBSK.  It is used for, among other things, rayon, a renewable textile fiber that is a substitute for cotton, and other fossil fuel derived synthetic fibers.

Based on the preliminary feasibility analysis:

  • the scale, technical ages and regional wood pricing at the Company's facilities would permit Celgar and Stendal to be first and second quartile cost producers of DP respectively. Due to size and other considerations, it was decided not to undertake a feasibility study for the Rosenthal mill;  
  • while the Company will always maintain its focus on being a leader in NBSK pulp, the enhancements would result in the Celgar and Stendal mills having an estimated annual DP production capacity of 400,000 and 500,000 tonnes, respectively;     
  • to maintain our core NBSK business and our commitment to customers, we would only adjust some production to DP to realize enhanced margins. If production were shifted for half the year, the annual production capacities at Celgar and Stendal would be approximately 260,000 and 300,000 tonnes of NBSK and 200,000 and 260,000 tonnes of DP, respectively;  
  • the project would take about 16 months to implement, with no expected impact to NBSK production with the exception of an approximate 3 week required shutdown for project tie-in at the end. Trial campaigns of DP production could begin in early 2013 if a decision to order equipment was made in the third quarter of 2011;

Initially the Company would most likely implement the project at one mill. As part of a final technical and feasibility study, the Company is implementing a process to select which mill and timing. Factors affecting mill selection will include levels of government support and technical limitations. A potential technical limitation has been identified for Celgar due to the mill's use of a continuous digester, while no technical limitations have been identified at Stendal as it employs super batch digesters.

Stock quotes in this article: MERC 

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
DOW 16,408.54 -16.31 -0.10%
S&P 500 1,864.85 +2.54 0.14%
NASDAQ 4,095.5160 +9.2910 0.23%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto
Advertising Partners

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs