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Norske Skog Saugbrugs granted CO2-compensation

09 August 2019

The Ministry of Climate and Environment amends The Norwegian Environment Agency's decision of 19 December 2013 on the basis for CO2 compensation for Norske Skog Saugbrugs AS.

The changes are that Saugbrugs will not receive a reduction in CO2- compensation for the years 2018, 2019 and 2020.

The Ministry of Climate and Environment amends The Norwegian Environment Agency's decision of 19 December 2013 on the basis for CO2 compensation for Norske Skog Saugbrugs AS. The changes are that Saugbrugs will not receive a reduction in CO2- compensation for the years 2018, 2019 and 2020.

Sven Ombudstvedt, Chairman of the Board and Chief Executive Officer (CEO) of Norske Skog, commented:

- This is a very gratifying message, and I would like to pay tribute to the Government, which has used the legal scope here to provide one of the world's most climate-friendly paper mills with CO2 compensation in line with other qualified industries”.

Norske Skog’s long-term strategy remains to improve the core business, to convert certain of the Group’s paper machines and to diversify the business within the bioenergy, fibre and biochemical markets.

Kjell Arve Kure, Managing Director of Norske Skog Saugbrugs AS says:

- The significant competitive disadvantage Saugbrugs has had since 2012, compared to our largest competitors, is now eliminated. The future CO2-compensation depends on the CO2 quota price, but for the years 2018 and 2019 the compensation for us amounts to NOK 32 million and NOK 86 million respectively. The government's decision to give us CO2-compensation is thus a significant contribution to maintaining the existing business and investing in new forward-looking business in synergy with the paper production.”

Norske Skog Saugbrugs is currently exploring the opportunity to create new, promising bio-based products. Already in 2016, biogas production commenced based on waste streams from paper production, which is delivered to local public transportation. Research and development work is now taking place concerning wood based construction board, biocomposites and nanocellulose (MFC) in collaboration with other industrial companies and with support from, among others, Enova, Innovation Norway and the Research Council of Norway.

In a press conference today the Minister of Climate and Environment Ola Elvestuen, Minister of Industry Torbjørn Røe Isaksen, CEO Sven Ombudstvedt and MD of Saugbrugs Kjell Arve Kure was present. Along with the Mayor of Halden Thor Edquist they elaborated on the very positive decision made.

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