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New GNP to celebrate one-year anniversary on Oct. 25

John Clarke Russ | BDN
John Clarke Russ | BDN
Dormant rails lead to the shuttered paper mill in Millinocket. Photographed Friday morning, Sept, 16, 2011.
By Nick Sambides Jr., BDN Staff

EAST MILLINOCKET, Maine — Gov. Paul LePage and his forest products advisor Rosaire Pelletier are among the key players who will be invited to help the new Great Northern Paper Co. LLC celebrate its one-year anniversary on Oct. 25, the company’s spokesman said.

“It is a great achievement, and the mill and its workers have earned a moment of celebration — particularly the workers,” spokesman Scott Tranchemontagne said Friday. “This is about congratulating them for their hard work and for all the extra work and moments where they have gone above and beyond over the first year.”

Other federal and state leaders, plus leaders from the Katahdin region, are among the invited guests, Tranchemontagne said.

“It is not lost on us that a lot of people came together to reopen this mill, and they should be recognized,” he said.

Today employing 272 workers, the mill is on-track to produce about 160,000 tons of newsprint and telephone directory paper with its No. 5 and 6 machines in 2012, company officials have said.

LePage culminated weeks of hard and largely secret work by his staff and local leaders and announced on Sept. 17, 2011 that Cate Street Capital of Portsmouth, N.H., had purchased the Main Street and Millinocket paper mills on undisclosed terms.

The deal was made final on Sept. 28 and the East Millinocket mill restarted on Oct. 17, 2011, with 215 workers, though its initial restart stopped a day or two later and was postponed by about a week due to mechanical problems.

The mill had a full year of orders and as of today has a confirmed 38- to 42-day order backlog for No. 6 and customer commitments to buy paper every 30 days or so for the rest of the year. The No. 5 machine runs three days a week, officials have said. The Millinocket mill, which has been shut down since September 2008, remains shuttered and company officials are not optimistic about its restart possibilities.

Besides qualifying for a Tax Increment Financing deal and other tax breaks, Cate Street negotiated for a lower property tax rate than its predecessor, Brookfield Asset Management, with the town and Millinocket and received a $1 million gap-financing loan from the Finance Authority of Maine to help it bridge startup costs and the first payments from its new customers, among other benefits.

The road to today has not been without bumps for GNP. Everett O’Neill abruptly resigned as director of operations at GNP in August and GNP President Peter Hanson left in December due to “philosophical differences” with other company leaders. The resignation followed by about a week Hanson’s statement to the Katahdin Area Chamber of Commerce that Roxanne Quimby’s proposed 70,000-acre national park was not a threat to the company’s future.

Tranchemontagne and other company officials issued clarifying statements a few days later saying that the company did not support Quimby’s proposal.

One of the company’s biggest hurdles was the restart itself. The company needed to get orders out the door by early November to make guaranteed shipments to customers that were crucial to the company’s solvency.

GNP got a nice boost from the approximately 5,000 tons of paper it produced for Random House and its erotic novel “Fifty Shades of Grey” over last summer and its national news coverage. The restart of the No. 5 machine in September added 37 jobs to company rolls.

Cate Street, which named its startup company Great Northern Paper Co. to echo the most famous and productive owner of the century-old mills, will tap into that history during its commemoration ceremony, Tranchemontagne said.

Company Chief Operating Officer Richard Cyr found two old brass plaques that he believes once hung on the machines. He cleaned them and they will be re-hung on each paper machine, renaming the machines “Penobscot” and “Katahdin” instead of by their numbers, Tranchemontagne said.

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