AUGUSTA (AP) – Gov. John Baldacci said he had a productive meeting about prospects of resuming mill operations with the owners and managers of the Katahdin Paper Co. in Millinocket, which has been shut down indefinitely.

“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 following Wednesday’s meeting.

“I appreciate the commitment of Fraser Paper and Brookfield to address the energy costs that led to the shutdown of the mill.”

About 200 people are being put out of work because of the mill’s shutdown Sept. 2. The owners said high energy costs were a key factor in the decision to close the mill, which is being mothballed and winterized.

With hopes of lowering fuel costs so it can reopen, Brookfield has hired consultants to study installing a biomass boiler.

The mill burned about 400,000 barrels of oil in 2007.

“We remain committed to a thorough analysis,” said Peter Gordon, Fraser’s chief executive.

The company told Baldacci it would report back to him by the end of November on its progress, “specifically as it relates to project feasibility, equipment costs, electric transmission needs and environmental permitting schedules.”

Brookfield hired Maine-based Cianbro Corp. to provide an engineering assessment of the project and Babcock & Wilcox Inc. to assess existing boiler and steam equipment at the mill.

Gordon said Brookfield has already invested about $70 million in the Katahdin mill, and won’t restart it unless it gets help from another investor to finance, install and operate the boiler.

Brookfield sought to sell the mill, which has long been the engine of the local economy, to Fraser for $80 million, but Fraser stockholders rejected the deal.

AP-ES-10-09-08 1134EDT

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