Oil costs could close Katahdin Paper (Maine)

[jpak]

http://bangornews.com/news/t/news.aspx?articleid=164991&zoneid=500

MILLINOCKET, Maine - Record oil prices will force Katahdin Paper Co. LLC to indefinitely close its Katahdin Avenue mill and lay off all 208 workers in 60 days unless an alternative energy source is found, company officials said Thursday.

"Curtailment" is also likely at the company’s East Millinocket mill, but company officials would not say whether layoffs or production cutbacks, or both, would occur. That mill employs about 350 workers. The two mills are the Katahdin region’s largest employers.

With the Millinocket mill consuming hundreds of barrels of oil daily to make heat and steam for its paper machine, and oil at $126.62 a barrel on Thursday — up from about $60 a barrel a year ago — company efforts to remain profitable have failed, said Glenn Saucier, the company’s spokesman.

"We have been looking at energy alternatives for quite some time and doing things internally to reduce energy costs," Saucier said Thursday, "but with the price of oil going in the direction it’s going, we just can’t keep up.

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