Amadeus JV

completed

LD Celulose SA (LDC) will build and operate a total chlorine free (TCF) dissolving wood pulp (DWP) mill (the 'Project', also referred to as the 'Amadeus Project') with a capacity of up to 500,000 tonnes per annum (TPA).  LDC is a joint venture of Lenzing (Austrian) and Duratex (Brazilian). Both companies have been IFC clients, their E&S performance has been satisfactory, and loans have been fully repaid. https://disclosures.ifc.org/#/projectDetail/ESRS/7333https://disclosures.ifc.org/#/projectDetail/ERS/11620    https://disclosures.ifc.org/#/projectDetail/ERS/21967 https://disclosures.ifc.org/#/projectDetail/ESRS/26784https://disclosures.ifc.org/#/projectDetail/ESRS/30559  The DWP mill will be located in the municipality of Indianopolis, Minas Gerais, Brazil, in a 150 ha site previously occupied by eucalyptus plantations within Duratex’s Nova Monte Carmelo (NMC) Forest Unit. The water intake and treated effluent discharge point will be located in the Araguari river, between the Miranda and Capim Branco reservoirs, in the municipality of Araguari. The Municipalities in the project’s area of influence are Indianopolis, Estrela do Sul, Nova Ponte, Araguari and Uberlandia.  The DWP mill site has the advantage of being crossed by the Ferrovia Centro-Atlântica railway connecting the site to the sea ports of Espirito Santo and Santos. The project’s water intake/effluent pipelines will take advantage of the right-of-way of existing roads, and the project’s transmission line will traverse agricultural landscapes. The project will require 2.9 million cubic meters of wood to produce 500,000 tons of DWP per annum sourced from 44,000 ha of existing eucalyptus plantations (Duratex’s NMC Forest Unit comprised of Fazendas NMC, Furnas and Brejão) and 26,000 ha of additional eucalyptus plantations in leased lands. The site is expected to be released for construction on June 2020 and the DWP mill is expected to start operating on March 2022. The project components include: -          pulp production (wood preparation, fiber processing, drying and baling); -          chemical recovery (evaporation, recovery boiler, causticizing / lime kiln); -          utilities (biomass boiler, water treatment plant, boiler feed water treatment plant and effluent treatment plant); -          cogeneration unit with a nominal capacity of 144 MW;-          area for unloading, handling and storage of sodium hydroxide, hydrogen peroxide, sulfuric acid and magnesium sulphate;-          dedicated plants for the production of oxygen and ozone;-          natural gas storage tanks;-          fuel oil storage tanks for boilers start-up;-          area for waste treatment; -          area for connecting to the existing rail line crossing inside the NMC Forest Unit; -          administrative areas (first aid post, laboratory, and restaurant); -          5-km access road from LMG-748 to the mill site;-          23-km effluent emissary/water intake to/from the Araguari river;-          22-km 138kV transmission line connecting LDC’s cogeneration unit; and-          two substations located one close to the water intake site and one in the industrial site. The project will also include the following associated facilities: (i) 4.2 km transmission line and substation to connect LDC’s transmission line to the transmission line of the electric power distribution company CEMIG- Companhia Energética de Minas Gerais S.A. located on the other bank of the Araguari river, and (ii) workers accommodations camps with a capacity up to 600 workers each. The Project is estimated to cost US$1.8 billion, to be financed with long-term debt and equity. The proposed IFC investment consists of an up to US$200 million A Loan, an up to US$50 million MCPP Loan and an up to US$250 million B Loan.