Although there were large timber supplies in Estonia and the Baltic countries, currently most pulpwood and wood chips exports from Estonia didn’t generate added value, Margus Kohava, member of the management of the investors’ new company Est-For, said at a press conference on Tuesday.

The investment would be worth around one billion euros, making it the biggest industrial investment in the history of the country, Kohava added. The planned factory would have Europe’s most modern technology, the impact of which on the environment would be kept to a minimum.

According to the investors, the new factory should have a positive impact on Estonia’s exports and economic growth. The direct added value created by the factory would be up to €350m a year, which amounts to between 1.4 and 1.8% of Estonia’s gross domestic product.

The factory would export its own produce worth €320-420m a year, which would increase Estonia’s annual exports by €250-350m. The export value of Estonian products would grow by 2 to 3%.

The plant would directly create 200 new jobs, and another 500 to 700 people would find work in the resulting value-generation chain. The factory’s production capacity would be 700,000 tons, and process 3 million cubic meters of raw timber a year.

“The exact size of the plant hasn’t been decided yet,” Kohava said. The factory would produce cellulose, hemicellulose, and lignin, which could be used to produce different bioproducts.

“At present we’re still talking about the intention to set up the factory,” Kohava said. He added that the exact technology, focus, and environmental impact were not clear yet, therefore the process would take some time. Kohava called on research facilities as well as companies to take part in the process.

Est-For Invest OÜ was set up in October 2016, and its owners include forest and wood processing group AS Lemeks, Caspar Re OÜ, a holding enterprise belonging to businessman Peeter Mand, Ivard OÜ, Kaamos Group OÜ, OÜ Combiwood and OÜ Tristafan.

The real beneficiaries of the company are businessmen Mati Polli, Tiit Nilson, Peeter Mand, and Kaido Jõeleht, who each own 16.67% of the company, and Jüri Kulvik, who owns 12.97%.