ELECTRICITY PRICES FULLY HEDGED 2003 AND 2004

The total hedging of electricity prices is currently: for 2003 97 % of the external usage is secured at the level of 26 – 27 öre per KWh, for 2004 97 % is secured at the level of 23 öre per KWh and for 2005 approx. 40 % is secured at 22 öre per KWh. This financial hedging of electricity prices provides an opportunity for Rottneros to obtain compensation for the high electricity price regardless of the physical consumption of electricity.

Rottneros has started the second year on an existing two-year agreement regarding the physical deliveries of electricity, which is made at spot rate. This agreement is made with one of the large suppliers on the market.

Because the extremely high electricity prices and the existing low pulp prices the Rottneros has now temporarily closed two production lines, one stone ground wood line in Utansjö and one CTMP line in Rottneros. The Group is following the situation day by day and it may be necessary to make more temporary stops more in the future depending on the electricity spot price development.

The external usage of electricity for the Rottneros Group which on an annual basis consumes almost one terawatthour (TWh) makes the Group one of the larger consumers of electricity in Sweden.

Upplands Väsby 2003-01-09

For further information please contact CEO Lars Blecko, 070-641 4910 or CFO Anders Byström, 070-641 4914.

Rottneros is one of the world’s leading independent manufacturers of market pulp. The Group consists of the parent company, Rottneros AB, which is listed on the Stockholm Stock Exchange, along with its subsidiaries of Rottneros Rockhammar AB, Utansjö Bruk AB and Vallviks Bruk in Sweden as well as Rottneros Miranda, S.A. in Spain, with activities involving production and sales of market pulp, Rockhammar Timber AB, which produces and sells sawn timber, plus the raw materials purchasing company of Rottneros Baltic SIA in Latvia. The Group has a total of 878 employees and a turnover of approximately SEK 2.7 billion.