Ence has cancelled its plans to build a 500,000 t/yr pulp mill on the River Uruguay near Fray Bentos. However, RISI reports that the company is now looking for another site to build a one million t/yr mill.
Ence’s pulp mill was to have been built close to another new pulp mill currently under construction by Finnish firm, Botnia. The two mills have been the subject of major protests in both Uruguay and Argentina.
Construction of Ence’s mill had been on hold since the end of March 2006, in response to the Argentinian government’s request for a three month suspension of Botnia and Ence’s pulp mill projects. Botnia continued construction of its mill.
Néstor Kirchner, Argentina’s prime minister, said, “It’s always better to have one problem rather than two.”
Juan Luis Arregui took over as president of Ence in April 2006. RISI reports Arregui as denying that the relocation was anything to do with the protests: “We are not relocating because of the conflict, we are relocating because, in terms of manufacturing processes, it is impossible to build two pulp mill in Fray Bentos.”
“These two plants would need 6 million tonnes/yr of fiber. A truck load is 30 tonnes so that’s 200,000 trips in a year, going up and down the same roads. And that’s just the wood, pulp dispatch would be about a third of that,” Arregui said.
“Due to the physical impossibilities [of building two plants in close proximity] we are going to have to relocate the plant. Where to, we don’t know, we are studying locations,” he said. However, responding to rumours that the mill might be built in Argentina, Arregui said, “Ence has always considered the building of a pulp plant in Uruguay to be of strategic importance. We’ve never doubted that and we don’t doubt it now. Ence will build the pulp plant in Uruguay.”
But Arregui’s arguments just don’t stand up. Ence has planned to build a pulp mill in Uruguay since 1998. Botnia announced its plans five years later. Arregui wants us to believe that it has taken the company five years to notice that there’s a problem.
Three months ago, newspapers reported that Arregui “considered the 7 km separating the company’s plant from Botnia’s an absurdity, with both plants located on the banks of the Uruguay River”. Ence dismissed the reports as “pure speculation”. A spokesperson for Ence told RISI, “We don’t know who this source is but it’s not from Ence; there are a lot of inaccuracies in these reports.”
In June 2006, RISI reported that Ence was looking at building the mill in Mercedes, 30 kilometres southeast of the site on the River Uruguay.
Ence’s subsidiary Eufores has been exporting wood from Uruguay since 1995. In 2003, Ence started its 800,000 t/yr wood chip mill at Terminal Logistica M’Bopicua on the Uruguay River. The wood chips are exported to Ence’s mills in Spain, as well as sold on the world market. Ence planned to build its pulp mill immediately behind the wood chip mill. Ence has so far declined to answer my questions about its plans in Uruguay.
On 25 September 2006, a 20 kilometre-long protest against the pulp mills stretched over the highway and bridge between Uruguay and Argentina.