Katahdin Paper mill to stay open beyond July 28 shutdown date

MILLINOCKET – The Katahdin Paper Co. LLC mill will run beyond its self-imposed July 28 shutdown, Gov. John Baldacci said Wednesday, but for how long is unclear.

The Katahdin Avenue facility will remain open “subject to continued customer orders and positive cash flow,” Baldacci said in a brief telephone conversation at about 6:30 p.m.

Millworkers interviewed after Baldacci’s statement said they heard from some of their supervisors Wednesday that the shutdown deadline has been extended into September, possibly until Oct. 1. No mill officials could be reached to confirm this.

Baldacci’s report Wednesday was the most positive development since company officials announced on May 29 their plans to indefinitely close the mill, one of the Katahdin region’s largest employers, and lay off all 208 workers on July 28 unless an alternative energy source is found.

Mill officials explained at the time that runaway oil prices make it unprofitable to operate the facility, which is fueled entirely by oil and which used more than 400,000 gallons of it to make steam in 2007.

Baldacci was cautious of being too optimistic Wednesday. He said efforts to secure an alternative energy source are among many efforts that might not come to fruition. While company officials have described the sought-after alternative energy source as a biomass boiler, Baldacci shied away from identifying it Wednesday.

“We have to be careful here. We have to understand that this is a work in progress,” Baldacci said. “They have to continue to work on these issues. It will be important to nail down some of the timelines to getting some of these things addressed.”

Mill management has said the plant’s No. 11 paper machine – Maine’s newest such machine – is valued at $150 million in today’s market and is booked with orders for catalog, magazine and retail industry fliers through 2008. But it was unclear Wednesday whether those orders would mean the mill would run until January.

Mill manager Serge Sorokin has an unlisted number and could not be reached for comment Wednesday evening. Glenn Saucier, the mill’s spokesman, did not immediately return a message seeking comment.

Baldacci’s forest products industry and economic development advisers continue to work daily with officials from Brookfield Asset Management, the multinational conglomerate that owns Katahdin Paper, and several third-party energy developers to find a way to wean the Millinocket mill off its oil dependence.

Several energy developers have expressed interest in financing energy-saving projects designed to capture heat wasted through paper machines or water sources, Sorokin has said.

“I just want to continue to reinforce the relationship that company officials have to Millinocket, East Millinocket and the state of Maine and our strong desire to continue to work on these issues,” Baldacci said.

Yet millworkers remained frustrated Wednesday as their unions met with mill management to discuss future developments, including who would be laid off in a shutdown. Contractual privileges might allow senior Millinocket workers to move to the company’s East Millinocket mill, with workers there getting pink slips.

Mill management, workers say, is proceeding as if a shutdown will occur.

“The deadline has been extended. That’s all we heard,” one worker said. “Nobody knows anything, and if they did, it would be out. But nothing is being said. It’s frustrating as hell because we just want to get on with our lives and to work. We just want to work.”

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