MERCER INTERNATIONAL INC

We have continued to make capital investments designed to increase pulp, green energy and chemical production, reduce costs and improve efficiency and environmental performance at our pulp mills. The improvements made over the years have increased the competitive position of our pulp mills. Since its acquisition, we have also made capital investments to optimize sawmill production at the Friesau mill.

The following table sets out the total capital expenditures by segment (excluding any related governmental grants) for the periods indicated:

(1)

Includes expenditures to rebuild the wood chip conveying systems at the Stendal mill which were damaged by a fire in 2022. The rebuild was financed with insurance proceeds, of which $12.2 million was received in 2023 and $2.2 million was received in 2022.

(2)

In our pulp segment, capital investments at the Stendal mill in 2023 primarily related to completing the rebuild of the wood chip conveying systems that were damaged by fire in 2022 and maintenance projects. In 2022, they primarily related to capacity expansion projects, initial costs to rebuild the wood chip conveying systems and maintenance projects.

Capital investments at our Rosenthal mill in 2023 primarily related to the completion of the lignin plant and maintenance projects. In 2022, they primarily related to the initial construction of the lignin plant and maintenance projects.

Capital investments at the Celgar and Peace River mills in 2023 and 2022 primarily related to wood room upgrades and maintenance projects.

In our solid wood segment, in 2023, capital investments were primarily related to optimization projects, including sorter line upgrades at our Friesau mill and Mercer Spokane facility, log yard improvements at our Torgau facility and other maintenance projects. In 2022, capital investments were primarily related to sorter line upgrades at our Friesau mill and other production improvement and maintenance projects at the Mercer Spokane facility.

Qualifying capital investments at industrial facilities in Germany that reduce pollutants in the effluent discharge can be used to offset wastewater fees that would otherwise be required to be paid. For more information about our environmental capital expenditures, see “– Environmental”.

In 2024, excluding amounts being financed through government grants, we currently expect our total capital expenditures to be approximately $75 million to $100 million, principally comprised of maintenance projects.