Those familiar with the efforts to find a new owner for the East Millinocket and Millinocket paper mills are cheered by Gov. Paul LePage’s decision to retain predecessor Gov. John Baldacci’s primary forest products industry adviser, Rosaire Pelletier, for the remaining 5½ months of Pelletier’s contract.
Pelletier will remain until his contract expires June 30, and perhaps beyond, said Dan Demeritt, LePage’s spokesman.
“Governor LePage understands the importance of the mills to the Katahdin region and the working Maine families who live in the area,” Demeritt said. “We are utilizing his contacts and expertise as the governor and his staff [get] up to speed … with these mills.”
Pelletier did not return telephone calls seeking comment.
Pelletier’s “continued presence is nothing but a positive for this area,” Millinocket Town Manager Eugene Conlogue said recently.
Brookfield Asset Management of Toronto, through a subsidiary, Katahdin Paper Co. LLC, owns the two mills and the company that operates the East Millinocket mill, Twin Rivers Paper Co. It also owns Brookfield Renewable Power, which owns 186 megawatts of electricity-producing dams on the Penobscot River and other bodies of water in Maine, according to brookfieldpower.com.
The Millinocket mill produced paper for catalogs, magazines and retail industry fliers until it closed in September 2008, eliminating as many as 208 jobs, due to the mill’s reliance upon foreign oil to generate steam as part of the papermaking process. East Millinocket’s mill makes telephone directory paper. Both were the region’s top employers when the Millinocket mill closed.
Brookfield officials said in April 2010 that they are working toward reopening the Millinocket mill if certain conditions are met.
Brookfield spokesman Andrew Willis said he could not comment on the sales efforts.
New York City-based Patriarch Papers, which owns Old Town Fuel & Fiber, announced last July that it was interested in buying the Katahdin mills, at which time the Baldacci administration’s efforts to secure a sale were also announced. Those efforts, which have come to involve several other companies, continue, said Duane Lugdon, Maine’s United Steelworkers Union international representative.
“We are still engaged in actively bringing owners to the table and arranging new ownership,” Lugdon said. “We still have hope that it is going to happen.”
Lugdon has said that Patriarch officials told him the mills are not viable in their current state and would need to be upgraded and retrofitted to produce high-end catalog, magazine and high-gloss-grade papers. The cost of those upgrades was part of Patriarch’s deliberations as to whether to buy the mills.
Lugdon said he does not believe that Brookfield wants to continue to own the paper mills, though its interest in the electricity-generating facilities remains strong.
“I would tell you that it has been evident for some time that Brookfield has not demonstrated an interest in securing a future for those mills. They have been very, very difficult to communicate with,” Lugdon said. “They do not communicate with unions except for their people at Katahdin Paper and Twin Rivers.”
Those familiar with the sale efforts describe Pelletier, a retired controller with Fraser Papers, as essential. They attribute his involvement to Baldacci’s desire to make the Millinocket mill’s restart part of his legacy, and to Pelletier’s knowledge of the paper industry statewide.
A previous owner of the two mills filed for bankruptcy on the eve of Baldacci’s first inauguration as governor. Pelletier has helped many mills restart or diversify, said Bill Peterson, spokesman for Twin Rivers.
“He has been a strong asset to the governor when [state government] has had to take over some of the distressed facilities within the state,” Peterson said.
Work on the potential sale took on great urgency as Baldacci’s second term wound down and is continuing,” Lugdon said.
Pelletier “is very astute in bringing aboard people who are interested in assets that are for sale,” Lugdon said.
Lugdon said he was worried that without Pelletier, LePage wouldn’t have any communication with state unions, but Demeritt said the governor would talk to anyone who could help build the state economy.
Lugdon said his union has helped broker paper mill deals in the past and is prepared to do so again.
“We are an instrumental player in retaining employment and making sure that these mills stay running,” he said.