MILLINOCKET (AP) – A Millinocket paper mill that halted production this week because of high oil prices has lost at least $57 million since the operation was restarted in June 2004, says an executive of the Canadian company that manages the mill.

The rebuilt machine at the Katahdin Paper Co. mill that makes magazine and catalog papers is “world-class” and will be started up anew if officials can negotiate a deal to install a biomass boiler, said Glenn McMillan, senior vice president and chief financial officer of Fraser Papers.

“The equipment is new and relatively good,” McMillan told the Bangor Daily News. “The biggest issue we face is oil.”

Fraser manages the Katahdin Paper mills in Millinocket and East Millinocket for Brookfield Asset Management, a Toronto-based conglomerate.

After halting production Tuesday, workers began mothballing the machine and equipment. More than 200 employees face layoffs as a result of the indefinite shutdown.

Union representatives said they understand that negotiations with prospective investors about installing a biomass boiler may be completed within a month, but McMillan said only that the talks were ongoing and he would not offer a restart date.

“We will restart the mill when we can operate it profitably,” he said.

The machine, which was rebuilt in 2001 at a cost of $100 million, lost $22 million in 2004; $11 million in 2005; $14 million in 2006; and more than $10 million in 2007, McMillan said. It was projected to record $6.6 million in profits this year, but has lost money thus far due to high oil costs.

Only subscribers are eligible to post comments. Please subscribe or to participate in the conversation. Here’s why.

Use the form below to reset your password. When you've submitted your account email, we will send an email with a reset code.