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Middle East Paper Company (MEPCO) has approved 1.78 billion Saudi riyals ($474.56 million) for the construction of a new phase of the containerboard paper plant project. The feasibility study on the fifth paper line (PM5) has been completed, the company said in a statement published on the Saudi stock exchange. The final budget includes the land value and an internal rate of return estimated at 14.5 percent.
Construction on PM5, which will have a production capacity of 450,000 tonnes, will start in the third quarter.
The project is expected to be completed in the fourth quarter of 2027, with commercial production starting in the same quarter.
The new phase will be funded by MEPCO's own resources, long-term loans from local banks and use of funds resulting from the issuance of the shares to the Saudi sovereign Public Investment Fund (PIF).
The company signed an engineering and supply contract with J M Voith SE & Co. KG to manufacture, supply, and supervise the installation of the main machine for the fifth paper line.
(Writing by D Madhura; Editing by Anoop Menon)
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