Norske Skog invests in Tasman, but jobs still lost

11.15am

Norkse Skog has confirmed a restructure of its Tasman pulp and paper mill in Kawerau, which will see job losses but could secure the future of the aging plant.

The Norwegian-owned Norske Skog is investing A$30 million ($33.4 million) on upgrading paper machines 2 and 3 at the plant, but will shut down PM 1 in two years' time.

Tasman's general manager, Peter Chrisp, could not confirm how many jobs will go in Kawerau as a result of the machine closure but said the restructuring had been flagged for the past two years and the company has been talking to unions for several months.

"We have been working reasonably closely with the unions over the past few months and we have established some overall principles as to how it's to be managed. But a lot of the details still have to be worked through and that's really what the consultation process is about," Mr Chrisp said.

Engineering, Printing and Manufacturing Union (EPMU) national secretary Andrew Little said while there will be some initial consultation in the near term, the key consultation will happen nearer to the machine's planned shutdown.

"They have got a time frame of two years so it will be a fairly lengthy wind-down process," he said.

Although the union was disappointed there will be job losses, Mr Little said the outcome was better than it could have been, as there had been periods when it looked like two machines were under threat.

"It's good to see they are investing in two of the machines....given some of the factors that the mill has to contend with, with energy policies and what have you, it was definitely under threat," Mr Little said.

Mr Chrisp said it made sense to close PM1, which is over 50 years old, as the mill doesn't produce enough pulp to keep the three paper machines going.

He said the restructure was something the mill had put to the Norske Skog board as a means to becoming more internationally competitive.

"It's something that we asked for, it's not something that was imposed on us. We looked at the future of this mill and what was needed to succeed and we put this forward as a package of change that would give the mill a sustainable future."

Tasman's overall paper capacity will fall from 365,000 tonnes per year to 315,000 tonnes per year. The 50,000 tonnes of capacity will be picked up by the company's Albury mill in New South Wales as part of an A$130 million upgrade at the Australian plant.


- NZPA