MILLINOCKET, Maine — State officials are reviewing the second of two permits for a proposed $48 million torrefied wood pellet facility at the Katahdin Avenue paper mill site and expect to issue that permit by Oct. 1.

The Maine Department of Environmental Protection approved a land development permit for Thermogen Industries LLC’s proposed facility at the paper mill wood lot on Aug. 16, said Samantha Depoy-Warren, the department’s spokeswoman.

Department officials are reviewing the air-quality permit and expect to OK it by the end of September, Depoy-Warren said.

The land permit application “was in process with us for just 73 days and the department is proud of its timely but thorough review,” Depoy-Warren said in a statement. “It will allow for the development of the site and the creation of new jobs in an innovative industry in the Katahdin region.”

The Millinocket Planning Board approved the application about a month ago.

According to the application, the torrefied wood chips will be transformed from wood wastes into “stable and water-resistant” pellets containing 30 percent more energy than standard wood pellets. The facility will be a major source of volatile organic compounds, producing an estimated 50 tons annually of VOCs, which according to the federal Environmental Protection Agency can cause a host of health problems.

Facilities on a list of similar major-source pollutants include the East Millinocket and Millinocket paper mills, Lincoln Paper and Tissue LLC and the Indeck biomass boiler in Enfield. All of them have scrubbers or other devices that contain or eliminate pollutant emissions or keep them within acceptable standards.

The EPA defines VOCs as toxins typically emitted as gases from certain solids or liquids that could have many short- and long-term adverse health effects, including eye, nose and throat irritation; headaches, loss of coordination and nausea; and damage to the liver, kidney and central nervous system.

Thermogen is confident that its systems will adequately filter those gases, company officials have said.

Officials from Cate Street Capital, Thermogen’s parent company, have said that the $35 million facility will use a Targeted Intelligent Energy System built by Scotland-based Rotawave Biocoal to manufacture biocoal, or torrefied wood.

The machine would be at least as quiet and odor-free as the paper mill it would go next to.

The plant would hire 25 full-time workers and begin producing, from about 240,000 to 250,000 tons of wood wastes, about 110,000 tons of torrefied wood pellets annually for sale to British and European coal-fired electricity plants. Cate Street expects the facility to open in the fall of 2013.

Tightened air-quality regulations in the United Kingdom and in Europe and a recognition by leaders there of the global warming hazard have created a need for torrefied wood that company officials are eager to fill, they have said.

A 30-day public comment period that closed recently drew no responses, Depoy-Warren said.

Company spokesman Scott Tranchemontagne did not immediately respond to requests for comment on Tuesday.