GORHAM, N.H. (AP) – Fraser Papers told 167 workers at its paper mill in Gorham that they will be laid off in two months.

Company President and CEO Peter Gordon said Monday that the impact of rising costs, particularly oil and market pulp, has resulted in significant operating losses.

Two of the machines are being shut down at the mill as of April 13.

The mill will continue to operate and employ about 180 workers.

The company referred to the shutdown as “temporary,” saying it will continue to work with the state to explore initiatives to reduce the mill’s reliance on oil as a fuel source.

“As a result of the production curtailments, 167 affected employees at the Gorham operations will be laid off indefinitely,” the company said in a news release.

Gov. John Lynch held a conference call with state officials Monday night to discuss plans to help the workers.

Lynch said the state’s Rapid Response team, made of representatives from the departments of Employment, Security, Labor, Resources and Economic Development, Health and Human Services, the New Hampshire Community College System and NHWorks, will take an assessment of the workers to determine what their needs may be in order to help them re-enter the workforce, including job counseling and retraining.

Sens. Judd Gregg and John Sununu and Rep. Paul Hodes quickly issued statements saying they are ready to assist with securing federal assistance for workers and their families.

“Many of these proud workers have been Fraser Papers for years now suddenly their livelihood is gone,” Hodes said.

“While the mill’s ability to return to full operating capacity is uncertain at this time, the loss of jobs greatly impacts the North Country’s economy and is cause for concern for many families in the community,” Gregg said.

Sununu brought Department of Labor and Commerce officials to Groveton in November to address the closing of the Wausau Paper Mill, and stood ready to do the same for the situation at Fraser.

A state report released last year called “Coos County Perspectives: The Groveton Mill Closures,” predicted that in addition to the 303 jobs lost at Wausau, another 233 jobs throughout Coos County will dissolve in 2008.

The report also projected that the number of job losses in the paper industry will likely be offset by the development of the federal prison in Berlin.

“The prison is expected to create 350 full-time jobs once construction is completed as well as hundreds of construction jobs,” said Gregg, who helped secure funding for the prison.

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