State makes headway in attempt to save mill

State officials are continuing to examine the feasibility of several alternative energy options for Millinocket’s Katahdin Paper Co. mill and plan to meet with its corporate owners in the coming weeks, Gov. John Baldacci said Friday.

State officials have identified three or four options for replacing oil as the primary energy source for the Millinocket mill. Baldacci declined to give specifics but said the team has heard from representatives in several fields, including the biomass and construction industries.

“People have been really stepping up to the plate and there are three or four options, and they are real options,” Baldacci said in a telephone interview. “What we’re trying to do is make sure the plant does not close.”

Officials with Katahdin Paper Co. announced on May 29 that they will be forced to shut down the mill – and lay off more than 200 workers – on July 28 unless an alternative energy source is found.

Katahdin Paper burned an estimated 400,000 barrels of oil at the mill last year to produce steam. And with oil prices climbing ever higher, company officials said they could no longer afford to keep the mill operating.

Katahdin Paper’s East Millinocket mill, which employs about 350 people, will remain open, although company officials have hinted that there may be effects on the work force.

The governor said his response team, which is headed by Baldacci’s senior forest products adviser, Rosaire Pelletier, plans to put together financial estimates for the different options next week. The following week the team will then go over those options with representatives of mill owner Brookfield Asset Management and Fraser Papers Inc., which operates the mill.

“This is one step forward, but we still have more work to do,” Baldacci said.

Glenn Saucier, spokesman for Katahdin Paper, said Friday evening that negotiations are continuing but that no decisions had been made.

The company had invested heavily in efficiency upgrades in recent years and looked into installing a biomass boiler at the plant. However, officials said it would have taken an additional 18 months to 24 months before a boiler was operational.

Social service agencies, as well as local churches, unions, businesses and other groups, are planning to offer assistance to workers if there are layoffs.

Baldacci also said he has heard from several companies that purchase the mill’s top-grade paper for use in catalogs, magazines and retail fliers such as newspaper advertising inserts. Baldacci said he plans to meet with additional mill customers next week.

“They are just letting us know how much they want the product, how much they depend on the product and how much they would hate to lose it,” Baldacci said.

kmiller@bangordailynews.net

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