Klabin invested R$ 1,348 million in the third quarter 2020 in its operations and expansion projects. Of the total invested, R$ 88 million was allocated to forestry operations and R$ 104 million to investments in the operational continuity of the plants that together represent investment in the Company’s operational maintenance. Additionally, R$ 15 million was invested in special projects, characterized by high and rapid returns. These investments are cash driven and not deemed as investments involving the forestry activities of the subsidiaries through Special Purpose Entities (SPEs) executed from the injection of forestry assets already existing in Klabin’s balance sheet.
Investments in 3Q20 in forestry activities compensated the limited planting executed in the preceding quarter due to the prolonged drought and COVID-19. It is worth recording that planting activity was a record in September 2020, representing efforts to counterbalance the decline in this activity occurring in 2Q20. Investments in operational continuity were normalized with the general maintenance shutdown of the Monte Alegre unit in August of this year. As already mentioned, the stoppage was limited in scope, prioritizing assets with shorter maintenance cycles and therefore postponing a comprehensive plant shutdown for the coming year.
To date, R$ 3.848 billion has been disbursed in the Puma II project, of which R$ 1.141 million related to the third quarter of 2020 and R$ 2.577 billion to the first nine months of 2020. Following the temporary demobilization in 1Q20 and subsequent remobilization during 2Q20 of the labor force involved in the work, the project’s start-up of the 1st Paper Machine was altered, operations now expected to begin in the month of July 2021 as opposed to the initial forecast of May 2020. Based on measurements made on October 21, 2020, some 57% of work on the first paper machine has been completed.
The new expansion cycle, approved on April 16, envisages a gross investment of R$ 9.1 billion (in real terms considering amounts at the beginning of 2019) comprising the installation of two paper machines for packaging with an annual capacity of 920 thousand tons of paper. The machines will be situated at Klabin`s Puma Unit where the Company already produces bleached hardwood, softwood, and fluff pulps. Klabin has negotiated financing for the project from ECA’s, BNDES, IDB Invest, IFC and JICA.