SANTIAGO, March 13 (Reuters) - Chile’s Celulosa Arauco y Constitucion expects its $2 billion Montes del Plata eucalyptus pulp mill, a joint-venture with Stora Enso in Uruguay, to reach full production this month, Chief Financial Officer Gianfranco Truffello said on Friday.
Montes del Plata, the biggest investment in Uruguay’s history, is slated to produce an annual 1.3 million tonnes of eucalyptus pulp once at full capacity.
Production is currently at 90 percent of capacity, but a 10-day planned work stoppage beginning on Monday will be used to iron out any remaining hiccups at Montes del Plata.
“We expect to get out of that with a 100 percent capacity because by doing the annual stoppage we will solve all the problems that we have identified during the ramp up process,” Truffello said during a conference call with investors.
Truffello said the mill should produce about 1.2 million tonnes in 2015.
Arauco, the wood and forestry arm of Chilean industrial conglomerate Empresas Copec, plans about $600 million in capital expenditures in 2015, Truffello added.
Arauco has been pumping cash into expansion projects and acquisitions in Brazil, Canada, Chile, the United States and Uruguay.
The company will focus on paying down debt and deleveraging throughout the year.
“We expect to be able to pay down all of our debt without the need to go to the market. That doesn’t mean that (we won‘t) make use of the low rate scenario at some point of the year to refinance some of the maturities coming next year,” said Truffello.
He added that he was not too concerned about decreasing demand for wood pulp from China. “That’s why we feel that demand for pulp and imports of pulp should continue growing at levels we have seen.” (Reporting by Felipe Iturrieta and Anthony Esposito; Writing by Anthony Esposito)