Smurfit-Stone says it's on tap for $543 million in black liquor funds for 2009

By Greg Rudder, Editor, PPI Pulp & Paper Week, RISI

SAN FRANCISCO, May 13, 2009 (RISI) - Smurfit-Stone Container's application for alternative fuels black liquor funding from the US government was recently approved by the Internal Revenue Service (IRS) and the company expects to gain as much as $543 million from the provision this year.

The company, which is financially restructuring under Ch. 11 bankruptcy protection, expects $183 million for the first four months of this year and $45 million per month thereafter.

Smurfit-Stone Container said it qualifies for the provision from its use of black liquor in the kraft pulping process at eight mills. The company did not gain any black liquor revenue from the IRS in the first quarter and expects its second quarter earnings to include the revenue.

Monday, President Barack Obama's budget plan called for eliminating the so-called alternative fuel black liquor tax credit by the end of September even though legislation for the credit is to end at the end of 2009.

Smurfit-Stone Container is the second largest containerboard producer and box maker in North America.

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