AUGUSTA (AP) – Canadian paper producer Domtar Corp. said Tuesday it will shut down a paper machine and eliminate 150 jobs at its Woodland mill in Baileyville as part of a companywide cut production capacity and costs.

Besides idling the Maine paper machine, the company is permanently closing its mill in Gatineau, Quebec, and its converting center in Ottawa, while shutting down another paper machine at its mill in Port Edwards, Wis.

“While we are in the process of leveraging our improved geographic footprint to serve our customers from our best-performing operations, adjusting our production to demand remains an ongoing exercise,” Raymond Royer, Domtar’s president and chief executive officer, said in a statement from Montreal.

The company said the closures will eliminate about 284,000 tons of Domtar’s annual production capacity and reduce its work force by about 430 people.

Saying he was disappointed by the company’s decision, Maine Gov. John Baldacci said meetings with Royer had made clear the Woodland facility “is a mill in transition and not a mill in decline.”

“Domtar senior officials have assured me that the pulp operation at the mill will be maintained and could see new investment in the future,” he said.

Baldacci also said he had talked with the company about research at the University of Maine and new technologies.

“The technologies that are being developed can make it possible to produce ethanol during pulp production. The process holds great promise to make Maine pulp operations more profitable while also creating an alternative source of fuel,” Baldacci said.

State Sen. Kevin Raye, R-Perry, said the decision to shut down the machine will have a profound impact on Washington County, where unemployment is high.

“It is crucial that every resource be brought to bear in response to Domtar’s announcement, as we have seen with similar closures elsewhere in Maine,” said Raye.

Domtar is one of the largest manufacturers of paper-grade market pulp in North America and claims employment of nearly 14,000.