A £300m paper mill will bring 150 jobs and put Norfolk at the forefront of the recycling industry.A privately-owned German company last night announced it would build the plant on the banks of the Great Ouse in King's Lynn.

A £300m paper mill will bring 150 jobs and put Norfolk at the forefront of the recycling industry.

A privately-owned German company last night announced it would build the plant on the banks of the Great Ouse in King's Lynn.

Palm Group said it intended to employ local people and offer apprenticeships and training in all aspects of paper making.

The site, which is between King's Lynn Power Station and the Norfolk Arena speedway track, was originally occupied by a sugar beet factory.

Negotiations between Palm and West Norfolk Council have been going on for some months. The Lynn site was one of a number shortlisted which had a power station and a nearby supply of water.

Derek Harman, managing director of Palm Paper Limited, said: “This is a very exciting development for Palm Paper.

“We looked at many sites across the UK and King's Lynn came out top of the list, because the project was welcomed and it fits well with our logistics for the target pressrooms we aim to serve.”

Last night, North West Norfolk MP Henry Bellingham said: “It's a fantastic day for King's Lynn - it's by far the biggest investment we've had for a generation.

“The council officers and members who worked on this - especially John Norton and Nick Daubney - deserve all the credit they get for having landed this in the face of tough competition.”

West Norfolk council leader Nick Daubney said: “We are delighted that Palm Paper has chosen King's Lynn as the preferred site for its first manufacturing operation in the UK.

“The proposed operation represents the largest single private sector investment in the Borough for many years and the company will further enhance the reputation of King's Lynn as a first class manufacturing location.”

Christopher How, cabinet member for economic development on Norfolk County Council, said: “This is a huge vote of confidence in Norfolk, and especially King's Lynn, as a good place to do business.”

James Gray, chief executive of East of England International, added: “This is a great coup for Norfolk and for the East of England.”

Mr Harman would not be drawn further on the plans, but one source said the company could be interested in connecting the plant to the rail network.

Some years ago, the former beet factory site - between the power station and Norfolk Arena - was earmarked as a possible location for a rail freight terminal.

The new plant will house one of the largest and most advanced paper machines in the world, which will make newsprint from 100 per cent recycled paper when it becomes operational, in 2009.

Currently more than half the waste paper collected in Britain is being exported to other countries, before being turned into paper products which then find their way back to this country.

Palm said the plant would significantly reduce the carbon footprint of the newsprint supply chain. But the company declined to discuss where the water, which is needed in large quantities for the paper-making process would come from and whether waste water from the plant would be discharged into the Ouse.

The Environment Agency said it was currently considering whether to request an environmental impact assessment of the plan.