IDB provides loan for pulp mill, 160-MW biomass power project in Uruguay

Aug 4, 2011 - The Inter-American Development Bank (IDB) said Tuesday it would provide a USD-200-million (EUR 139.7m) loan to help fund the construction of a pulp mill and a 160-MW biomass power plant in Punta Pereira, Uruguay.

The project is being developed by the Montes del Plata Group, a joint venture of Finnish paper maker Stora Enso Oyj (HEL:STERV) and Chilean sector company Arauco. The loan has a 12-year term, with a three-year grace period. IDB expects to pocket USD 250 million in additional financing from commercial lenders.

When up and running, the pulp facility will annually produce 1.3 million tonnes of pulp from eucalyptus wood. Additional infrastructure at the site will include a river port terminal, barge terminals and a wood chip plant. The biomass power facility that is part of the project will cover the pulp mill's power needs, while any extra electricity will be fed to the grid.

(USD 1 = EUR 0.698)

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