Dec 03, 2007. /Lesprom Network/. Norwegian papermaker Norske Skog, hit by overcapacity in the industry, said on Monday it would consider permanently shutting down up to 400,000 tonnes of newsprint capacity and will write down assets and goodwill, Reuters reported. The writedowns would result in a net reduction in equity of 800 million crowns ($145.3 million), the company said. Norske Skog said it was considering shutting permanently 300,000-400,000 tonnes per year of newsprint capacity in Europe and would make a decision in the first quarter of 2008, ahead of earlier plans. Norske Skog shares leapt on the announcement, and traded up 6.4 percent at 42.40 crowns at 0844 GMT, outperforming a 0.4 percent rise in the Oslo bourse benchmark index and a flat DJ Stoxx basic resources index . The company said it would write down the value of fixed assets by 1.8 billion crowns and goodwill by 2.7 billion crowns. But it said that the reduced estimated lifetime of its paper machines in Norway would generate a surplus of energy and energy contracts with a value of 3.7 billion crowns. "The accounting effects will result in a reduction of Norske Skog's equity of about 800 million Norwegian crowns," the company said. "Norske Skog is reviewing all its paper machines to identify which can be closed permanently or rebuilt to produce other paper grades," the company said. It said that after the expiry of low-cost energy contracts, the three paper machines at its Follum mill and two machines at its Skogn mill in Norway would not be competitive after 2010 assuming the present economic conditions continue. "The accounting assessments are based on the present political and business conditions in Norway. What the actual decision will be depends on the development of these conditions," Chief Executive Christian Rynning-Toennesen said in the statement.