• The project will involve the construction and operation of a high-efficiency recovery boiler at the Setúbal industrial complex.
  • This investment is an important step in Navigator’s decarbonisation plan, with significant energy efficiency and emissions reduction benefits.
  • The operation contributes to the REPowerEU plan to end dependence on fossil fuel imports.

The European Investment Bank (EIB) has signed a long-term financing agreement with The Navigator Company totalling €115 million. The loan is designed to support the construction and operation of a high-efficiency recovery boiler at the Setúbal industrial complex, which is a key step in Navigator’s decarbonisation roadmap.

The Navigator Company is an integrated producer of forestry, pulp, paper, tissue, sustainable packaging solutions and bioenergy. The new boiler, which comes at a total investment cost of €154.7 million, will enable Navigator to reduce direct fossil carbon dioxide emissions at the Setúbal industrial complex by around 136 000 tonnes a year, equivalent to 24.6% of the group’s emissions in 2022.

This loan is part of the REPowerEU plan, which seeks to boost the financing of green energy and support the autonomy and competitiveness of the European Union. The signing ceremony took place today in Lisbon and was attended by EIB Vice-President Ricardo Mourinho Félix and Navigator’s Chief Financial Officer Fernando Araújo.

“Europe’s industry is in transition towards a circular and climate-neutral economy. This project is a brilliant example of this, as it improves the energy efficiency of the plant, contributing to the European Green Deal and aligning with the EIB’s objectives,” said Mourinho Félix. “The EU climate bank is leading the path to economic growth, while putting an end to dependence on fossil fuel imports by increasing energy efficiency and stepping up production from renewable energies.”

The EIB is contributing €45 billion in additional financing to support REPowerEU, which is expected to mobilise more than €150 billion of investment by 2027 in support of green technologies and Europe’s energy independence, helping to reduce fossil fuel imports by increasing efficiency and stepping up production from renewables.

Background information

About the EIB

In 2022, the European Investment Bank Group (EIB Group), made up of the European Investment Bank (EIB) and the European Investment Fund (EIF), reported total financing in Portugal of over €1.7 billion, which included unprecedented amounts of support for projects in the fields of climate action and environmental sustainability.

The EIB and energy security

In 2022, the EIB Group committed more than €17 billion to finance the energy transition in Europe, a top priority for the EU climate bank. These investments are helping Europe to accelerate the transition to sustainable energy and weather the crisis triggered by the abrupt cut in gas supplies in the wake of Russia’s unjustified invasion of Ukraine.

In July 2023, the EIB Board of Directors raised the amount earmarked for REPowerEU projects to €45 billion. REPowerEU is the plan designed to end Europe’s dependence on fossil fuel imports. This additional funding comes on top of the EIB’s already robust support for investments in sustainable energy. It is a 50% increase on the original €30 billion package for REPowerEU announced in October 2022.

To boost financing for the EU manufacturing industry, the EIB will also expand the range of eligible sectors to include leading strategic technologies with net-zero carbon emissions, as well as extraction, processing and recycling of critical raw materials. The additional financing will be disbursed between now and 2027. In total, it is expected to mobilise more than €150 billion in investment in the target sectors.

Find out more about the EIB’s support for the energy sector here.

About The Navigator Company

The Navigator Company is an integrated producer of forestry, pulp, paper, tissue, sustainable packaging solutions and bioenergy, whose operations are underpinned by state-of-the-art technology at world-class manufacturing facilities. It is recognised as a benchmark in quality in its sector throughout the world.

People, their quality of life and the planet’s future are what inspire and guide The Navigator Company. The company is committed to creating sustainable value for its shareholders and for society at large, making a better planet to hand down to future generations through sustainable products and solutions that are natural, recyclable and biodegradable, and that contribute towards carbon sequestration, oxygen production, the protection of biodiversity, soil formation, and the fight against climate change.

The Navigator Company produces pulp and paper using forests which are planted exclusively for this purpose. Each year, Navigator nurseries give life to more than 12 million trees. These nurseries, the largest in Europe, produce 135 different species of trees and shrubs. Many of these, although not economically viable, are financed by the company to protect biodiversity and guarantee species’ continuity.

The forests under The Navigator Company’s management in Portugal represent a carbon stock, excluding carbon in the soil, equivalent to 6.1 million tonnes of CO2. This stock has remained stable thanks to the sustainable management model followed by the company.

The group’s forestry business is vertically integrated, with its own Forestry Research Institute. The group is responsible for planting a vast forested area in Portugal (1.2% of the country’s land area), 100% certified by FSC[1]® and PEFC[2] systems. The company has a production capacity of 1.6 million tonnes of paper, 1.6 million tonnes of pulp, 130 000 tonnes of tissue, and 2.5 TWh of renewable energy a year. In 2021, 66% (vs. 60% in 2020) of energy produced by Navigator at its four industrial complexes came from biomass, giving it the leading role in the sector, with this ecological non-fossil fuel accounting for about 35% of the country’s overall energy.

In November 2021, the Navigator Company launched its latest line of packaging products, through the new gKraft brand, to help accelerate the transition from plastic to the use of natural, sustainable, recyclable and biodegradable fibres, once again demonstrating its commitment to sustainability and preserving the environment.

The company is Portugal’s third largest exporter, accounting for approximately 1% of GDP, around 2.4% of all the country’s exports of goods and more than 30 000 direct and indirect jobs and new jobs created. It is also the Portuguese exporter generating the most national value added. In 2021, The Navigator Company had a turnover of €1.596 billion. More than 90% of the group’s products are sold outside Portugal and are shipped to approximately 130 countries.

The Navigator Company has made a formal commitment to achieving carbon neutrality at its industrial complexes by 2035, 15 years ahead of the targets set by the European Union and Portugal. This makes it the first Portuguese company, and one of the first in the world, to set itself this ambitious goal, for which it has earmarked total capital spending of €340 million.

This commitment is the culmination of a responsible business management strategy that had already been distinguished by the CDP (formerly Carbon Disclosure Project, now Disclosure Insight Action) in 2019 and 2020, with the classification of global leader in the fight against climate change. The Navigator Company was recognised for its efforts to reduce emissions, reduce climate risks and develop a low-carbon economy.

At the end of 2021, The Navigator Company joined the Science Based Targets initiative (SBTi), having submitted its greenhouse gas emission reduction targets based on the most current climate science at the time of joining, thus dispensing with the two-year grace period that companies have and typically use to do so. The company has been developing a set of strategies to measure and reduce its total greenhouse gas footprint, as well as to promote mitigation and adaptation to the risks generated by climate change. By joining SBTi, the company is making progress in aligning with scientific-based criteria and methodologies that deserve international recognition within the scope of the global climate agenda, affirming its leadership in sustainability.

In 2022, Navigator obtained a score of 14.3 in the ESG Risk Rating for 2021 — the best rating obtained since being added to Sustainalytics assessments — once again positioning itself among the best companies in the world in terms of sustainability. With this classification, the company remains in the “Low Risk” category, meaning that it presents a low risk for investors. It occupies third place in the ranking of companies in the “Paper and Forest” industry group (out of a total of 81 global companies that are part of this cluster), and in the “Paper and Pulp” subgroup (out of a total of 60 companies worldwide).

[1] FSC – Forest Stewardship Council® (FSC® licence no.: C010852)

[2] PEFC – Programme for the Endorsement of Forest Certification schemes (PEFC licence no.: 13-23-001)