EBRD lends 10 mln euro for biomass boiler at Bosnian paper plant

The European Bank for Reconstruction and Development (EBRD) said on Wednesday it is lending 10 million euro ($13 million) to Bosnian pulp and paper producer Natron Hayat for the installation of a biomass boiler and steam turbine.

The boiler and the turbine will run on bark and sawdust left over from the pulp-making process, meaning the waste material no longer has to be taken to landfill sites or piled up around the production facility, the EBRD said in a statement.

By using biomass instead of coal to produce steam and electricity for Natron Hayat’s manufacturing process, the boiler is expected to cut the plant’s carbon emissions by some 275,000 tonnes a year. Furthermore, any surplus of electricity may be sold to the national power grid.

“This will be the first combined heat and power plant in Bosnia and Herzegovina to deliver energy generated from industrial waste to the national grid. The project will benefit the environment by providing a solution to the company’s waste disposal issue and by reducing carbon emissions. We hope it will have a strong demonstration effect for other private players in the Bosnian economy,” Frederic Lucenet, EBRD director for manufacturing and services, said.

Natron Hayat, majority-owned by Turkish sister companies Kastamanou Entegre and Hayat Kimya, which are in turn owned by the Hayat Group, is a leading pulp and paper producer in the Western Balkans employing some 850 staff. Its main products are kraft paper for sacks used in the cement and agribusiness industries, various types of packaging paper and cardboard products. In 2011, it had annual turnover of more than 67 million euro.

Natron Hayat has received in the past two loans from the EBRD to help modernise its production process and finance its working capital needs.

The latest EBRD loan to Natron Hayat is being provided in two tranches: a tranche of up to 6.0 million under the Western Balkans Sustainable Energy Direct Financing Facility and a tranche of up to 4.0 euro million under the Local Enterprise Facility.

Since the beginning of its operations in Bosnia and Herzegovina, the EBRD has committed more than 1.4 billion euro in over 100 projects in key sectors of the country’s economy, mobilising additional investments of more than 1.6 billion euro.

($=0.753 euro)

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