Sappi CEO Steve Binnie
Dissolving wood pulp and paper products manufacturer Sappi and Norwegian firm Borregaard will invest R105-million on expanding the production capacity of their joint venture (JV) lignin manufacturing operation LignoTech South Africa, in KwaZulu-Natal, by 20 000 t/y.
The expansion, which would increase output to 180 000 t/y, would be completed in 2017 and the additional volumes would be marketed to existing applications and geographical markets.
LignoTech South Africa’s products are used in a range of applications such as industrial dust control, concrete admixtures, animal feed and agrochemicals.
Borregaard provides the JV with sales and marketing functions in overseas export markets, in addition to technology, and research and development functions, while Sappi supplies lignin raw material and utilities from its Saiccor mill.
“Looking to the future, Sappi will target strong growth from new business opportunities related to energy, nanocellulose and bioproducts including lignin and sugars. This expansion is an important vote of confidence in our JV with Borregaard and the global competitiveness of South Africa-based LignoTech,” commented Sappi CEO Steve Binnie.
Borregaard president and CEO Per Arthur Sørlie added that it was a strategic priority for Borregaard to grow its lignin business.
The investment was expected to strengthen LignoTech South Africa’s competitive position, as well as improve Borregaard’s offering to key markets in Asia, the Middle East and Africa.