BANGOR – Paper Acquisition Corp., the Massachusetts-based company that earlier this year tried to buy bankrupt Eastern Pulp and Paper Corp., is in discussions with state officials regarding setting up operations at Eastern Pulp’s former mill in Brewer.

The talks are in the preliminary stages but are among a few options that Gov. John Baldacci this week said he is pursuing for the mill site.

Also, the governor said that he has discussed the mill site with a financial entity in New York City, but he would not name the financier.

A week ago, Baldacci announced the creation of a task force to explore manufacturing options for the Brewer mill site. The announcement caught Brewer officials off-guard. They stated publicly that they had an agreement with Baldacci not to publicize the task force until its motives were better defined.

Brewer officials had been considering redeveloping the 41-acre riverfront property for light manufacturing, an arts center, studio or loft apartments and office space, according to Drew Sachs, Brewer economic development manager.

Baldacci said he wants to present the options to the city of Brewer, which technically is the mill’s new owner, and other members of the task force during a meeting scheduled for Tuesday, June 22, in Brewer City Council chambers.

“When I sit down with them, I want them to know these are the areas that I think are more viable for restart or reuse, and at the same time recognize that the city of Brewer is driving economic development,” Baldacci said. “We need to form a partnership.”

Sachs said Friday that he, too, has been talking with prospective tenants for the mill site. He said he could not name them.

Robb Osinski, a partner in Paper Acquisition, said this week that his company wants more information about what the governor or the task force envisions for the mill site.

He said he asked Jeffrey Sosnaud, deputy commissioner of the Department of Economic and Community Development, to give him a list of financial, environmental and other incentives the state is willing to offer, plus a report on the condition of the mill site and the equipment inside.

“I think trying to make a go of it with that facility is a difficult proposition,” Osinski said. “But I would be receptive to hearing what the plans are and seeing if we could plug into that endeavor.”

Sosnaud did not return a telephone call for comment. DECD Commissioner Jack Cashman did not return telephone calls for comment and did not make himself available for discussions at a Thursday event in Portland.

Paper Acquisition in February had offered $8.5 million to buy Eastern Pulp’s mills – Eastern Fine Paper Co. in Brewer and Lincoln Pulp and Paper Co. in Lincoln.

The company particularly was interested in the Brewer operations because one of its partners, Satish Agrawal, a former chief technology officer with Polaroid Corp., had worked on at least two patents or pending patents with Eastern Fine researchers.

About a month after submitting its offer, and days before a bankruptcy court auction of Eastern Pulp’s properties, Paper Acquisition told a federal bankruptcy judge that it could not proceed with the sale because it did not have enough time to complete the deal.

Bankrupt Eastern Pulp, which owned Eastern Fine Paper Co. in Brewer and Lincoln Pulp and Paper Co. in Lincoln, was sold to First Paper Holding LLC of Connecticut in late April through the federal bankruptcy court process. More than 750 people lost their jobs when Eastern Pulp was shut down in January.

First Paper reopened the Lincoln mill last week under the name Lincoln Paper and Tissue Co. and will employ 360 people by mid-August.

To buy the Brewer mill, any prospective occupant will have to negotiate with Brewer, First Paper and a couple of Eastern Pulp’s creditors who have liens on some of the mill’s contents.

In its $23.725 million deal, First Paper purchased the Brewer facility but then gave ownership of its real estate and buildings to the city of Brewer.

Instead of the assets being listed under the city’s name, however, Brewer officials set up a limited liability corporation called South Brewer Development LLC, according to Curtis Kimball, the city of Brewer’s attorney.

The corporation was formed to protect Brewer taxpayers from “any financial burden or any environmental recourse” associated with the mill site. Any proceeds from a sale of the real estate or buildings would go to the city, Kimball said.

First Paper owns some of Eastern Fine’s paper equipment and machinery, including the No. 2 machine and a coater – two pieces of equipment viewed as essential to any papermaking operation at the Brewer mill. Creditors have liens on other machinery, spare parts, chemicals and inventories.

First Paper also formed its own limited liability corporation, LPT Liquidating LLC, to protect itself from financial responsibility if any unforeseen environmental or other damage arises from the removal of machinery, parts, inventory or chemicals.

Any property not claimed by First Paper or the creditors is considered useless or too old to sell and will be junked, Kimball said.

Most of what First Paper owns, excluding a few items that can be carried out by hand, still is on the property, Kimball said.

Before Brewer or the task force can take any action on the property, hundreds of containers of hazardous chemicals and other waste have to be removed from the site by the federal Environmental Protection Agency, Sachs said. Also, environmental cleanup issues, such as removing an oil spill in the middle of the property, may have to be addressed.

On Thursday, the state Department of Environmental Protection announced that the removal process would start next week and is expected to go on for a couple of months.