MILLINOCKET (AP) – A Millinocket paper mill that’s struggling to compete at a time of high oil prices halted production Tuesday as it prepares to lay off more than 200 workers.

“We made our last ton of paper this morning,” said Glenn Saucier, a spokesman for Katahdin Paper Co. “We’re cleaning up the machine and putting it in preservation mode so when we get ready to start it up again it will be clean and ready to go.”

Management will soon be meeting with union officials to discuss the pending layoffs, Saucier said. The union says some of the 208 workers at the mill who have seniority will be able to bump less experienced employees at Katahdin’s sister mill in East Millinocket.

The mill’s parent company, Brookfield Asset Management of Toronto, announced last spring that the mill would be closing indefinitely because of record high oil prices. The company has been seeking an investor to build a biomass boiler that would heat and power the mill at a lower cost.

Union officials told the Bangor Daily News that the company was poised to sign a biomass deal that could set the stage for the mill’s reopening as early as next April.

“I am told on good authority that if we can get it inked, quickly, the total build time here (for the boiler) is six to nine months,” said Duane Lugdon, a representative for three United Steelworkers International unions in the Millinocket-area mills.

However, Saucier said he was unaware of any agreement and had no idea when production in Millinocket might resume.

The century-old mill, formerly called Great Northern Paper Co., underwent a modernization in 2001 that included a $100 million rebuild of a machine that now produces catalog and magazine paper.

Some members of the Millinocket Town Council recently proposed seizing the mill and its electric generators by eminent domain, then turning the generators into a public utility. Gov. John Baldacci has advised against such a move, saying the town’s best course is to work with the company.

AP-ES-09-02-08 1350EDT

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