NewPage, Nova Scotia Power plan biomass facility

VANCOUVER, April 5 (Reuters) - Papermaker NewPage Corp [NEWPG.UL] and Emera Inc.'s EMA.TO Nova Scotia Power unit unveiled plans on Monday for a 60 megawatt biomass co-generation plant at NewPage's Port Hawkesbury mill.

The utility will spend about C$200 million ($200 million), including C$80 million to buy an existing generating asset from NewPage, which will then be responsible for operating the power plant, which is expected to begin operation in 2012.

The project is subject to provincial regulatory approval.

NewPage already uses wood biomass to generate electricity for the Port Hawkesbury paper mill, but the new facility will allow it to phase out the use of natural gas or bunker oil as back-up fuel supplies, the company said.

NewPage now harvests about 1 million tonnes of wood annually for making paper and electricity at the mill, and the new project will require an additional 400,000 tonnes.

NewPage and Nova Scotia Power said the project is part of a plan that could see biomass produce about 400 gigawatts of power in Nova Scotia annually, or enough to supply about 3 percent of the province’s electricity demand. (Reporting Allan Dowd; editing by Rob Wilson)