Fraser Papers Aims to Reopen Greener Maine Mill

Fraser Papers, which operates the Katahdin Paper Mill in Millinocket, ME, announced plans in May to shut down the venerable mill due to the high energy costs of running it. But now there is talk of a reopening next year. According to published reports, officials have hired two companies to study installing a biomass boiler at the Millinocket mill to ameliorate its dependence on oil.

Fraser Papers CEO Peter Gordon told mill workers and Gov. John Balducci that Brookfield Assets Management – the mill’s parent company – has already invested $70 million, but needs further financial assistance. Brookfield has hired Cianbro and Babcock & Wilcox to provide an engineering assessment of the mill and its existing boiler and steam equipment, Gordon said in a release.

Mill managers hope to refit the company’s No. 4 boiler as a biomass boiler to save time and money. “We have told the governor that we will report back to him by the end of November to brief him on our progress, specifically as it relates to project feasibility, equipment costs, electric transmission needs and environmental permitting schedules,” Gordon said.

Katahdin Paper Co. shut down its Millinocket paper mill in early September because of record prices; the measure will put about 208 people out of work. “We continue to work together to ensure the shutdown is a temporary measure and that the hard-working employees can get back to work as soon as possible,” Baldacci said in a statement. “I appreciate the commitment of Fraser Papers and Brookfield to address the energy costs that led to the shutdown of the mill.”

Brookfield tried to sell the mills (including one in East Millinocket) to Fraser last year for $80 million, but Fraser’s stockholders rejected the proposal. The state-of-the-art Millinocket mill burned about 400,000 barrels of oil in 2007.

Dan Walsh, vice president of catalog/publication papers at distributor Bradner Smith & Co., says if the mill reopens it will have “a positive impact” for customers using supercalendered and suypercalendered-plus paper. “One of the issues was energy – oil required to fuel the mill,” he says. “Now they have plans to retrofit an existing oil-fired boiler and convert it to a biomass gasifier. They’ll get the biomass from area timberlands and even have enough energy generated to sell the excess to the state.”

It will take Fraser Papers and Brookfield about 10 months to get the mill ready and reopened, and everything has yet to be signed off on, but Walsh says it looks like it will happen. “Ultimately, it will hurt the market from the paper industry standpoint for the same reasons. As more catalogers look to cut costs, SCA is a good alternative to #5 groundwood. With this supply looking like it’ll be coming back on, it’s a good thing.”

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