Mercer International Provides Update on Status of Rosenthal Kraft Pulp Facility.

Business Editors

ZURICH, Switzerland--(BUSINESS WIRE)--Jan. 31, 2000

Mercer International, Inc. (Nasdaq:MERCS, Easdaq:MERC GR) announced today that the ramp-up of production at its recently-converted Rosenthal kraft pulp facility is progressing ahead of schedule and within the Company's expected cost parameters. After being converted from a 160,000-tonne sulphite pulp production facility to a 280,000-tonne kraft pulp mill, Rosenthal was successfully re-started on December 18, 1999.

The Company noted that the mill is producing both Elementally Chlorine Free (ECF) and Totally Chlorine Free (TCF) grades of northern bleached softwood kraft pulp. It is currently averaging over 750 tonnes per day of production, or 95% of rated daily capacity, with peak production of 800 tonnes of pulp per day on some production runs.

Commenting on these developments, Jimmy S.H. Lee, Chairman and President of Mercer International, stated, &uot;We could not be more pleased with the progress we have made at Rosenthal to date. As we have progressed through the facility's break-in phase, we have consistently improved the quality of the pulp being produced, and are currently selling product at market prices. At this time, the mill is running at production levels well above those necessary to cover operating and overhead expenses given today's pulp prices.&uot;

Mr. Lee continued, &uot;We are also pleased with the timing of the start-up relative to the pulp cycle. Over the past six months, pulp prices have improved 22% and we see indications that the pulp markets should remain strong going forward. We have identified significant demand for our new product, and are building several days of inventory to enable us to fine tune our production. Based on our outlook for the pulp markets and the ramp-up of Rosenthal to date, we remain comfortable with our expectations for the mill and look forward to further enhancing its performance in the future.&uot;

Mercer International Inc. is a European pulp and paper manufacturing company.

The preceding includes statements which constitute forward looking statements and involve known and unknown risks and uncertainties which may cause the Company's actual results in future periods to differ materially from forecasted results. These statements appear in a number of places and include statements regarding the intent, belief or current expectations of the future operating performance. Any such forward looking statements are not guarantees and may involve risks and uncertainties and actual results may differ from those in the forward looking statements as a result of various factors including general economic and business conditions and government regulations. Among other factors which could cause actual results to differ materially are the following: market conditions, competition, the ability of the Company to execute its business plan and other risk factors listed from time to time in the Company's SEC reports.