Baikal PPM is to be closed, Rosbalt reports. Due to fall in demand on pulp, lack of quality raw materials and nonconformance to ecological standards the mill has not been operated since November 10, 2008.

“The government decided that it is useless to invest in the Baikal PPM. No doubt, that there is an urgent problem re. employment of the workers”, said the head of the Irkutsk region.

At the same time the board of directors is considering the possibility of bankruptcy – with debt in arrears making up 1.3 billion RUB (about 30 million EUR).

In October 2008 management of the company laid off 150 workers and later additionally 1 377 people. Currently 3 000 people are to be dismissed.

Mill’s capacity made up 200 thousand tons of pulp per year. 51% of shares belong to Continental Management (Group of Companies) and 49% - to Federal Property Fund.

Upon demand of the Ministry of Nature there was installed a closed-loop water system in September 2008. However, new system cannot be used for pulp production based on chlorine bleaching. As a result the mill produced only nonbleached pulp the manufacture of which turned out to be unprofitable.

Business Support Bureau "Runa" www.runa.info

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