West Fraser Timber Co. Ltd. (TSX:WFT) plans to spend $37 million to upgrade its Hinton pulp mill with credits under the federal government’s Pulp and Paper Green Transformation Program.
The company will be upgrading the mill’s pulp machine to allow the facility to produce 420,000 tonnes more pulp in a more energy-efficient way. The upgrade will reduce natural gas consumption of the plant by more than 55,000 gigajoules per year, reducing greenhouse gas emissions by 2,750 tonnes.
The company said the upgrade will help improve the mill’s overall competitiveness in the market and return to production levels achieved when the mill ran two production lines.
This is the second major upgrade under the Pulp and Paper Green Transformation Program for the mill this year. In May, the company announced a $15 million upgrade that improved the energy efficiency of the plan to reduce the mill’s natural gas consumption.
In September, the company announced a $125 million capital spending program to expand and upgrade the company’s solid wood operations due to a stronger balance sheet.
As of September 30, 2010, the company had $221.5 million in cash and short-term investments, up from $12 million in the same period last year. Sales for the past nine months rose to $2.17 billion, up from $1.78 billion in the same period in 2009. The company posted a net profit for the nine-month period of $127.5 million, up from a net loss of $320.7 million.
West Fraser’s share price range during the past week: between $44.93 and $46.32; 52-week high: $47; 52-week low: $29.81.