December 7, 2009

Nippon Paper Chemical to Build a New Pulp Machine at Gotsu Mill
---Strengthening diversified business for GV2015 ---

Nippon Paper Group, Inc.

Nippon Paper Chemical Co., Ltd. (President: Toshio Inoue), a Nippon Paper Group company, has decided to build a new pulp machine at its main operation site Gotsu Mill (Gotsu City, Shimane Prefecture) in order to enter the market for high added value cellulose(*) applications. The new facility of 6.3 billion yen investment is scheduled to be completed in the fall of 2011.
Nippon Paper Group aims in the Third Medium-Term Business Plan (2009-2011) released recently to strengthen its business other than paper. The investment in Gotsu Mill mentioned above is part of this initiative, and will expand the mill's business domain and bolster its profitability.
Nippon Paper Chemical's Gotsu Mill is the only domestic manufacturer of dissolving pulp and has established its leading position by supplying dissolving pulp sheet to both domestic and overseas makers of rayon and cellophane. The new pulp machine will enable the Company to manufacture dissolving pulp roll and greatly help it approach the nascent market for high added value cellulose products.
(*)Main lumber constituents refer to cellulose, hemicellulose and lignin. Pulp used in paper making is of those constituents other than lignin whereas dissolving pulp demanded for chemical industry applications is of higher cellulose content. Dissolving pulp sheet products are used as raw materials for rayon and cellophane, while rolled products for cellulose derivatives (methyl cellulose, cellulose acetate, cellulose nitrate and other applications).

Reference: Lumber Constituents
Reference: Lumber Constituents