Long-term power supply contract with Vattenfall

Long-term power supply contract with Vattenfall

Billerud has entered a ten-year contract with Vattenfall for electricity
supplies. The contract comprises 400 GWh of baseload at a fixed price and an
agreement for balancing power and electricity supplies at spot price for a
four-year period. The contract also includes portfolio management of electricity
and electricity certificates.

”This long-term contract is part of our efforts to secure Billerud's long-term
competitiveness,” says Per Lindberg, managing director of Billerud. “Access to
electricity is important for us and with this contract we have covered more than
80 per cent of our total electricity needs via our own production and long-term
contracts.”

”We are pleased to have reached this agreement with Billerud. We fully
understand the value of long-term power supplies for power-intensive industries
in Sweden,” says Hans von Uthmann, vice managing director of Vattenfall and
manager of Vattenfall Norden. “It is in Vattenfall's own interests to offer
good, lengthy contracts to basic industry in Sweden,” he continues.
”The contract with Billerud is just one of several examples of Vattenfall's
striving to make long-term contributions to good prerequisites for Sweden's
basic industry,” Hans von Uthmann adds.

Through extensive investment in renewable electricity production, over a period
of two years Billerud has reduced its need for purchased electricity from 1100
GWh to 700 GWh. The company is also modernizing its machinery by extensive
upgrading of two paper machines in Skärblacka and Gruvön at a cost of 370
million SEK during 2007.

”We do not have time to wait and see whether the electricity market may become
less uncertain. Our assessment is that we have entered a good contract and a
balanced supply of electricity. We can now go ahead and develop our main line of
business which is to deliver competitive packaging solutions,” says Per
Lindberg.

The contract is for baseload during the ten-year period 2008-2017, and for
electricity at spot price and balancing power for remaining electricity
purchases during the period 2008-2011.

Solna, May 16, 2007
Billerud AB (publ)


Per Lindberg
President & CEO

For further information, please contact:
Per Lindberg, President & CEO Billerud AB, +46 8 553 335 00; +46 702 481 517, 
or Bertil Carlsén, CFO Billerud AB, + 46 8 553 335 07; +46 730 211 092

Hans von Uthmann, vice President Vattenfall AB and Manager Vattenfall Norden 
via Anna Lihr, Press secretary Vattenfall +46 8 739 55 93; +46 70 893 33 52


Billerud is a packaging paper company. The company's business concept is to
offer demanding customers packaging materials and solutions that promote and
protect their products - packaging that is attractive, strong, sustainable and
based on renewable materials. Billerud has a world-leading position within
several product segment; within paper for consumer and industrial packaging.
Production takes place at three integrated pulp and paper mills in Sweden and at
one paper mill in the UK.

www.billerud.com