Catalyst Paper is investing nearly $16m in the Rumford pulp and paper mill in Maine, US, as for its upgrade and maintenance.
Around $11m will be spent on maintenance projects including the upgrade of the mill’s Recovery Boiler C. The boiler’s 35-year-old generating bank will be replaced with a new one.
Catalyst is investing $4.5m in capital expenditures of this quarter compared to $1.8m in the first quarter.
Rumford mill produces coated one- and two-sided paper for food and beverage packaging. It employs around 800 people.
An upgrade to the Recovery Boiler C is expected to reduce operational costs for Catalyst, which has spent $3m in energy in the previous quarter due to record cold temperatures.
Catalyst Paper president and CEO Joe Nemeth said: "Today’s announcement reflects the strategic investments we’re making in our recently acquired US assets to accelerate operational excellence improvements that will ultimately deliver enhanced performance and results.
"We expect to realize the benefits of this and other key investments in the second half of 2015 as we complete planned maintenance and capital work, and manage the significant costs we anticipated related to the integration of our US operations."
The company is expecting to complete the maintenance work at the Rumford mill by this month. The mill has been temporarily shut down resulting in the curtailment of 25,000t production.
Catalyst Paper purchased Rumford paper mill in January.