EAST MILLINOCKET — Gov. Paul LePage has signed into law a bill that would allow electricity sales to restore at least 200 jobs and re-energize a local paper mill, his spokeswoman said Tuesday.

“This is a step in the right direction so that both parties can come to an agreement,” said Adrienne Bennett, calling the new law necessary. “The governor is pleased that it moved forward as quickly as it did.”

The new law, which LePage signed on Monday, permits hydroelectric dam owner Brookfield Asset Management to negotiate a shared profit with mill parent company Cate Street Capital to sell electricity to the marketplace “as long as there is no reduction in labor force associated with the cessation or reduction of paper production.”

The previous law had limited how often Brookfield could sell electricity. The new law effectively allows both parties to sell wholesale electricity more often while keeping the mill operational, legislators said.

The dams were originally built to accommodate Katahdin region mills exclusively and legislators passed the original law in 2002 to prevent a mill owner from closing the mill just to generate electricity. Under state law, Maine people own the water that powers the dams.

Cate Street Capital spokesman Scott Tranchemontagne said Tuesday that as far as he knew, his client was awaiting word from Brookfield on its latest offer in negotiations that began last month.

Brookfield attorney Harold Pachios said Tuesday he expected that his company would respond to the offer within the next few days.

Cate Street’s subsidiary Great Northern Paper Co. ceased mill production in late January and laid off 212 of the mill’s 256 workers about two weeks later, citing high energy and production costs and the need for greater efficiencies.

Company officials said they hoped to reopen with a new business plan that would remedy these concerns by May 1, but negotiation documents released by both parties last week indicated a more likely restart deadline of June 1.

Cate Street had said that passage of the bill, sponsored by Rep. Steve Stanley, D-Medway, was a critical component to the mill restart plan. Tranchemontagne has never specified precisely what the other components are or whether the company has fulfilled them.

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