Montreal-based forestry products giant Abitibi-Consolidated Inc. said Wednesday it will team with Norway's Norske Skog and Hebei Longteng Paper Corp. of China to build and operate a US$300-million newsprint mill.

The mill, to be located in China about 280 kilometres southwest of Beijing, will be operated by a joint venture that will be called Hebei Pan Asia Long-Teng Paper Co.

Construction of the 330,000-tonne-per-year mill is expected to begin by the end of the year and finish by the third quarter of 2005. The plant will exclusively use recycle fibre as its feedstock.

In a joint statement, the partners said the plant "is ideally located in the greater Beijing metro area with its population of 100 million and high anticipated growth rates."

The mill will be 65-per-cent owned by Pan Asia Paper Co., a Singapore-based 50-50 joint venture between Norske Skogindustrier and Abitibi-Consolidated. Chinese partner Hebei Longteng Paper is an investment company owned by the province of Hebei, the city of Shijiazhuang and Zhaoxian county.

"Abitibi-Consolidated has long viewed Pan Asia Paper as our growth vehicle in the world's most promising regions. The Hebei mill is expected to sell 70 per cent of its production within a 500-kilometre radius of the mill," John Weaver, president and CEO of Abitibi-Consolidated, said in a statement.

"Pan Asia Paper is extremely well positioned to capture its share of the Chinese newsprint consumption growth from just under two million tonnes today to three million tonnes in 2008, when Beijing hosts the Summer Olympics."