Sri Lanka reports restart of Embilipitiya Paper mill that closed in 2003; production to be 250 tonnes/day

COLOMBO, Sri Lanka , Dec. 6, 2011 (Press Release) - Embilipitiya Paper mill resumed operations last week under the National Industrial Re-awakening Program of the Government.

According to the State Resources and Enterprise Development Ministry, Perth Engineering and Maintenance (WA) (Pvt).Ltd of Australia has been granted the management contract of the paper mill.

Around 250 metric tons of paper will be produced daily. Three-hundred-and fifty direct employment opportunities will be created under the new management, said the secretary of State Resources and Enterprise Development Ministry Dr. W.W. Gamage.

The Embilipitiya paper mill was first set up in 1978. The mill was closed in 2003 and factory assets worth millions of rupees were sold to settle the workers' dues.

The Paper Mill resumed operations in 2008 with a capital investment of Rs.35 million as envisioned in the Mahinda Chintana to make state resources productive.

However, due to the poor quality of the machinery and the high cost of re-investing in machinery the plant was compelled to close again in 2010. Despite its closure, the Government continued to pay staff salaries amounting to Rs.4.3 million monthly until last November.

Over Rs.350 million was paid as compensation to 171 former employees at a ceremony at the Sri Lanka Foundation Institute, last week.