The R765-million expansion to paper and plastic packaging manufacturer Mpact’s Felixton mill will expand the company’s product offering and increase the mill’s capacity by 60 000 t/y to 215 000 t/y on completion, says Mpact CEO Bruce Strong.
The Felixton mill was established in 1953 near Empangeni, in KwaZulu-Natal, and produces containerboard for the local and export corrugated markets using waste paper and bagasse (a fibre residue of sugar cane) as primary raw materials. The expansion will improve the company’s market position and create significant employment opportunities.
The mill successfully completed the first phase of the upgrade in June last year. During this phase, a new recycled fibre plant was constructed and the mill’s paper machinery was upgraded to increase pulping capacity, provide flexibility to handle wet strength material and improve pulp quality.
Two-thirds of the funding for the upgrade will be spent during the second phase, scheduled for commissioning in 2017. The completion of this phase will enable the mill to produce products using 100% recycled fibre rather than bagasse. Further machinery upgrades will also be undertaken that will boost product strength properties and increase operating efficiency.
Strong believes that capital investment across the Mpact group is critical to take advantage of growth prospects in its markets. In this case, the Felixton mill will improve the quality of Mpact’s paper products and the mill’s overall competitiveness in line with global trends, owing to the latest paper machine technology and machinery being installed as part of the upgrade.
In addition, a starch preparation plant with storage facilities will also be constructed. The drying area will be optimised through the redesign of dryer groups, with the installation of sheet-stabilising equipment allowing for increased sheet stability at higher speeds.
“The packaging sector is experiencing moderate growth and being able to compete against imported products is of paramount importance . . . [and] to remain competitive, our focus areas are efficiency and energy,” Strong explains.
The upgrading of the Felixton mill will, moreover, enable it to manufacture lightweight paper. One of the biggest international trends in paper packaging is reducing the weight of corrugated boxes while maintaining strength characteristics. This assists in reducing costs in packaging supply chains.
Environmental benefits of the upgrade will include a 25% reduction in carbon dioxide emissions, as well as a 15% and 18% decrease in energy and water use respectively. Sixty-two per cent of the mill’s chemical oxygen demand with further be removed from its effluent stream.
As part of the upgrade, Mpact secured an eight-year structured loan facility of R200-million with the KwaZulu-Natal Growth Fund.
“This is a landmark transaction for the KwaZulu-Natal Growth Fund and the province. We are particularly pleased with Mpact’s progress in priority focus areas of broad-based black economic empowerment and the creation of job opportunities . . . investment in the Felixton mill upgrade demonstrates our confidence in this partnership with Mpact in meeting the province’s developmental goals,” states KwaZulu-Natal Growth Fund CEO Siddiq Adam.
Mpact is embarking on a significant skills development programme for its employees to ensure that they have acquired the necessary skills to operate the new machinery.
The expansion will furthermore stimulate job creation through increased requirements for waste paper, at least half of which will be met by new collection initiatives. Mpact has also established seven buy-back centres in Richards Bay, which are managed by small business entrepreneurs. Trolley-preneurs deliver their recyclables to the buy-back centres.
“Through our investments in the expansion of our waste paper collections, we anticipate that more than 1 000 jobs will be created in the recycling industry,” concludes Strong.