Press Release Archive - 2003

Anglo American plc (“Anglo American”) will proceed with a US$150 million conversion and expansion of paper machine 1 (PM1) at its Merebank paper mill, in KwaZulu-Natal, South Africa. The announcement was made at a briefing in Durban today attended by South Africa's Trade and Industry Minister, Mr Alec Erwin.

The project will include upgrading of most parts of the existing PM1 and thus increase the capacity for competitive production of uncoated woodfree paper grades. The production of magazine paper grades on PM1 will be discontinued. Additional cutting capacity for the conversion of woodfree paper reels to A4 sheets will be installed as well. The mill's annual production of uncoated woodfree paper will increase from its current 274,000 tonnes to 524,000 tonnes by 2006.

A further amount of US$44 million will be invested in an emission reduction programme. As a first step, this will incorporate flue gas desulphurisation of the existing coal fired boilers at a cost of US$7 million. Mondi will also be proceeding with the installation of a US$37 million multi-fuel boiler as a subsequent stage in an overall plan which includes:

• converting an existing oil fired boiler to gas
• decommissioning one high-pressure oil fired boiler and replacing it with a new low-pressure gas fired boiler
• retiring the two remaining standby oil fired boilers following the installation of the new multi-fuel boiler

The combined impact of the plan will result in a 66% reduction in SO2 emissions from the mill.

Andrew Thompson, Chairman and CEO of Mondi South Africa, said, “This significant development at the Merebank mill is an important further step in Mondi's strategy to grow our business in value-added cut paper grades, based upon our globally competitive eucalyptus forestry and pulp production base. Our markets for cut paper have shown consistent growth for several years, although they are subdued at present. This project will capitalise on our market position and significantly increase exports, in the case of Europe and other important markets, exclusively through the well-established international marketing network of Mondi Europe's Neusiedler.

The measures to reduce environmental emissions have been developed after evaluation of all the options and in close consultation with relevant stakeholders. They also take into consideration common practice in highly developed countries, even in the most environmentally sensitive areas.

We much appreciate the constructive role played by Government to support both this industrial investment and thus sustainable development in this province of South Africa.”

Ends

Background note
Mondi South Africa forms part of Anglo Paper and Packaging, a division of Anglo American plc. Anglo Paper and Packaging contributed 21% to Anglo American's headline earnings for the six-month period to 30 June 2003, making it the second largest contributor to the Anglo group. Headline earnings rose by 16% from $153 million to $178 million. Anglo Paper and Packaging's operating profit was $357 million, 23% higher than for the first six months of 2002, with Mondi South Africa contributing $97 million and Mondi Europe $260 million.

Anglo American plc is one of the world's largest mining and natural resource groups. With its subsidiaries, joint ventures and associates, it is a global leader in gold, platinum group metals and diamonds, with significant interests in coal, base and ferrous metals, industrial minerals and paper and packaging. The group is geographically diverse, with operations and developments in Africa, Europe, South and North America and Australia. (www.angloamerican.co.uk).

Disclaimer:
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