LINCOLN – As it completes its first year, the Lincoln Paper & Tissue Co. is studying a $37 million plan to double the plant’s tissue-making capacity and hire more workers, company officials said Wednesday.

As part of the plan, company brass is working with town officials to apply for a $400,000 Community Development Block Grant. A meeting last Monday with mill owner Keith Van Scotter to discuss the grant proposal was postponed. It will likely occur Monday, Van Scotter said.

The grant would be part of an effort to double the plant’s tissue-making capacity from 100 tons daily and using another 100 tons of pulp made at the Katahdin Avenue plant each day, said Van Scotter, who seemed hesitant to reveal the company’s plans without further study.

The project would help the mill remain competitive by shifting some emphasis from paper production to tissue creation, Van Scotter said.

“Tissue orders are very strong,” he said Wednesday. “Tissue production fits this business better, and the customers need it.”

Mill officials haven’t decided whether to implement the plan, but should within the next three months, Van Scotter said. If it goes forward, the plan should lead to the hiring of a “significant” number of new workers, though Van Scotter would not say how many just yet.

The mill employs about 360 people, he said.

Town officials have discussed the grant informally with Lincoln Paper officials and will do whatever they can to help the success of the mill, which is the town’s largest employer, Town Manager Glenn Aho said.

“We are committed to helping them succeed with this the way we would help any business in town to succeed,” Aho said.

Community Development Block Grants come through the state Department of Economic and Community Development and often are used to help businesses expand.

With the exception of the last three weeks, the mill’s paper and tissue operations have generally been running at capacity, creating 200 tons of paper and 100 tons of tissue daily, Van Scotter said. During that time, workers upgraded the plant’s recovery boiler, which recycles chemicals used in the pulping process.

That work was finished last weekend, he said.

Van Scotter and his partner John Wissman, Lincoln Paper’s chief financial officer, brought the firm’s rebirth from the ashes of the abandoned Eastern Pulp and Paper Co. when the partners completed their $23.7 million purchase of the plant in May 2004. The mill reopened in June.