Question-and-Answer Session
Operator
(Operator instructions) Your first question is from line of Bob Wetenhall with Royal Bank of Canada.
Bob Wetenhall – Royal Bank of Canada
Hi, good morning. Thanks for taking the question. Just wanted to ask you, why is the discount between – or the size of the discount between pulp list prices in Europe and average pulp sale realizations increasing?
Jimmy Lee
In terms of the European market or – basically, the list prices of course reflect the price set in US dollars, and of course, the mill met realizations are of course booked at the time that we receive the actual sales; and of course, there is currency impact. And of course, you do have increase in spot selling at Stendal, and of course, the Chinese markets tend to be weaker than the European markets. So, I think it’s the combination of underlying currency movements during the period as well as the fact that there has been slightly increased sales to, let us say, non-contract buyers.
Bob Wetenhall – Royal Bank of Canada
Understood. And just to clarify, you said an incremental EUR16 million from selling on the grid in Europe from Stendal and Rosenthal as opposed to participating in the carbon credit program?
Jimmy Lee
Yes, I mean that would be the estimate of the increase in electricity sales as compared to 2007. And of course, as you know, the carbon credit sales, we believe would have contributed something in the order of maybe 4 million this year and declining as we go through the period. So it is difficult to estimate what the contribution for next year would be, but the estimate in terms of the carbon sales for this year was approximately 4 million, and of course, that will come down. So, 16 million is a very conservative number for us, because of course, we can sell the Green Energy during periods when electricity prices in general tend to be weaker. So, there is not a specific time that is allocated that we need to sell it at. So we believe that the 16 million probably represents a very conservative type of revenue increase.
Bob Wetenhall – Royal Bank of Canada
Fair enough. And I think that number that you guys have provided is 38 million to build out the energy facility at Celgar. And I was just curious, it sounds like you are going to get a PPA agreement in place. And how are you financing the CapEx build-out of this?
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