The recent winter storm Elliott in the United States has unfortunately caused havoc on several mills across the states.
We recently reported that International Paper's Georgetown, SC mill had an unexpected shutdown due to freezing weather.
The problem started when a tube in a power boiler blew and subsequently, they couldn't generate enough internal power.
While the mill began to rely on Santee Cooper for power, given the hard freeze, it was having trouble meeting the demand for electricity system wide, and could not provide the power that International Paper's mill needed.
The black liquor inside the pumps at the Georgetown mill then froze solid.
In our article, we reported that "Getting everything unplugged to start making pulp...That is going to take weeks. We are in serious trouble and it is going to be bad," the post states, adding it "will cost this company millions" to recover from the damage.
We also recently reported that Rayonier Advanced Materials Jesup, Georgia mill was impacted by a natural gas supply disruption.
In our article, it states that "Rayonier Advanced Materials Inc. announced that its facility at Jesup, Georgia has been impacted by a force majeure declared by its natural gas provider, Southern Natural Gas Company, L.L.C., due to an unscheduled outage of the Elba Express Pipeline's Hartwell Compressor Station.
Southern Natural Gas Company has asserted that, during the period of the SNG Force Majeure Event, which commenced on December 24, 2022, RYAM's Jesup facility will be subject to a financial penalty for each MMBtu of natural gas consumed in excess of a contractually allocated amount. Based on this and other current assumptions, the Company expects the Event could reduce EBITDA by approximately $775,000 to $900,000 per day."
When the force majeure was canceled, RYAM said it "resulted in an estimated $4 million EBITDA impact to the Company. The Company continues to reserve all rights to more fully examine, and potentially contest, the validity of the financial penalty it has been assessed."
We'll keep you apprised on these and other situations as they arise.
Helen Roush is Executive Vice President of Paperitalo Publications.