Scottish paper makers rally against gas hikes

Scottish paper producers have joined the ranks of firms protesting against escalating gas prices, and are calling on the Government to act.

Tullis Russell managing director Chris Parr, who has been interviewed by BBC Reporting Scotland on the subject, said his firm's gas prices had increased ten-fold.

"Our daily gas prices have climbed from 5,000 to 10,000 to as much as 50,000 over the past three years."

Parr warned that price increases in 2006 could now follow, with producers finding it increasingly difficult to absorb mounting charges.

He said it was staggering that European and US competitors were paying up to 80% less, as gas companies were finding it more economical and getting a far better price by selling to these countries.

"It's this volatility that is difficult to manage. We need a more level playing field," said Parr.

Fellow Scottish producer Curtis Fine Paper has also joined in the rallying call.

Managing director Keith Chapman said industrial gas prices had trebled in the last five weeks alone.

The increases were the result of tight supply as North Sea gas reserves shrink.

"One would expect gas to flow to the UK from the Continent at current prices," said Chapman.

"The interconnector has not yet delivered this and the Government should examine why."