ONE YEAR LATER: OLD TOWN AFTER G-P

The new owner of the former Georgia-Pacific Corp. mill in Old Town is taking steps to gear up its partnership with the University of Maine to produce ethanol and other biochemical products on the 180-acre site.

Edward Paslawski, chairman of Red Shield Environmental LLC, a group of private investors that bought the mill six months ago, said this week the proposed biofuel production would be done in conjunction with a restart of the plant’s pulp mill.

The operation would be under the name RSE Pulp and Chemical.

Restarting the pulp operation is key to the ethanol production process because the material that is taken from the wood pulp is put through a complicated distillation process to make ethanol.

Paslawski said Red Shield is waiting for final approval from the state Department of Environmental Protection to start the pulp operation and can’t do so until mud season is over and wood can be harvested.

“Everything else is set to go,” he said.

Some 100 of the 450 people who were laid off when the mill shut down are expected to be rehired, he said.

Red Shield already has hired 55 people to operate the facility’s biomass boiler. It is used to heat the facility and produce electricity that is sold to the power grid.

Other business prospects are being discussed and negotiated for the site.

Red Shield acquired the mill site for $1 in a state-brokered deal last year. While it is considered relatively clean environmentally, problems have arisen in recent weeks. Toxic levels of lead have been found in ash within the boiler. Ash from the smokestack also has fallen on homes and yards in neighboring Bradley but is not believed to be toxic.

DEP and Red Shield are working to resolve the issues.

“There’s always problems that pop up, but we’re able to handle them,” Paslawski said. “When you’re working with a facility like this, you will have trouble from time to time, but it can be solved.”

DEP officials said this week they haven’t received Red Shield’s license modification application for the pulp operation, but that preliminary discussions have taken place.

Other Red Shield and state officials working on the project were reluctant this week to explain details of the potential pulp startup plan.

The University of Maine in neighboring Orono is playing a major role in Red Shield’s plans.

UM received a $10.35 million grant to conduct research on using wood to make ethanol, plastics, industrial chemicals and other products now made with oil.

There is a strong market for ethanol production, which is a substitute for MTBE or methyl tertiary-butyl ether, which is found in automobile gasoline. MTBE is being banned in some places because it is suspected to cause cancer and has been found in water supplies.

With the three-year grant, which consists of $6.9 million from the National Science Foundation and another $3.45 million in matching money from the state, UM researchers want to determine the kinds of products that could be made from wood byproducts, how to make them, and how to market them.

In addition to producing ethanol, the process creates other salable byproducts, such as carbon dioxide for beverage carbonation and dry ice.

The size of the operation that will be housed in Old Town hasn’t been determined.

There is enough space, money, and a ready work force to sustain a pilot-scale plant, but Paslawkski said he and other investors already are reviewing the possibility of developing the operation into a commercial-scale facility.

“I can’t tell you quite how big it will be yet,” he said in an interview.

Paslawski said other options are being eyed to use part of the mill site:

. A hydroponics company from the Netherlands is negotiating with Red Shield, he said. The company would run a greenhouse on land adjacent to UM. Paslawski said there have been initial discussions with UM about its possible involvement in the project, “but there’s no agreement.”

. Under the name RSE Pellet LLC, Red Shield is trying to start a wood pellet production operation that likely would be housed in a portion of the warehouse space available. The plan is to export the pellets to Europe, Paslawski said. Wood pellets are made of compressed sawdust and are a renewable, clean and efficient fuel source. It’s not clear whether Red Shield will market its product locally.

. Hallowell Heat Pump Manufacturing, one of the original companies to sign on to the project, is slated to move its commercial manufacturing into the site this fall. Based in Bangor, the company has about a dozen employees.

“There are a couple other businesses lined up that I can’t discuss yet because plans haven’t been finalized yet,” Paslawski said. “Our goal for this is to have about 10 different businesses on-site within the next three years or so and have about 2,000 jobs.”

He recognizes that some people are pessimistic about the potential for the site to be viable, particularly since one of the original companies to be involved backed out and there have been problems getting the boiler up and running.

“It is visionary and we can’t see it today, but knowing the companies from the inside, I feel pretty optimistic about it,” Paslawski said.

Where are they now?

Georgia-Pacific Corp. closed the mill and associated chip mills in Milo, Costigan, Houlton and Portage on March 16, 2006.

450 people laid off

49 went back to school

191 working full time

49 employed hourly at Red Shield

6 working part time

127 unemployed or status unknown

Numbers are estimates provided by former millworker and Bangor CareerCenter peer support worker Jim England.