PORT ANGELES — McKinley Paper Co. vice president of operations said his company is taking a measured approach to transforming the former Nippon Paper Industries USA paper mill at Ediz Hook, purchased March 31 by the Mexican-owned cardboard linerboard manufacturer.
“The industry has gotten so competitive and gotten so integrated that it truly has become a product of globalization, so we have to make sure to take our time and get it right,” Herb Baez said Friday during a 10-minute presentation to a gathering of three dozen regional and North Olympic Peninsula community and business leaders brought together by the Seattle Metropolitan Chamber of Commerce.
The luncheon meeting at Peninsula College, facilitated by Clallam County Economic Development Corp. Executive Director Bob Schroeter, was a stop on the Seattle chamber’s two-day, In-State Study Mission to the Olympic and Kitsap Peninsulas, which included stops in Clallam and Jefferson counties.
McKinley, a subsidiary of the Mexican recycled paper manufacturing giant Bio-Pappel, bought Nippon, which includes a $91 million biomass cogeneration plant, for $20.6 million in a sale finalized March 31.
One questioner at Peninsula College asked Baez about the fates of 106 hourly workers who were laid off by the time Nippon stopped production earlier this year and the plant was transferred to McKinley.
Forty salaried workers also were laid off.
Baez deferred to McKinley spokesman and former Nippon human resources director Cathy Price.
“We’ve applied for trade assistance act [help] for all of them, and we haven’t gotten an answer from the state on whether it’s been approved,” she told the group.
Price said in a later interview that an additional group of about 30 people are still working at the mill doing administration, security and ongoing plant maintenance.
“We are calling it the security and preservation phase,” she said.
The linerboard industry has become “highly competitive,” Baez said at the meeting. “We will be recalling people, but we will be taking our time.”
Baez said in an interview after the meeting that the retooled mill will be re-opened around fall 2018, sticking with the maximum, and approximate, 18-month plan company officials said was the reopening timeline as of April 1.
“If this had happened seven to 10 years ago, we would be up and running,” Baez said.
Price said later there is no definite date for the reopening but that it should still occur in 2018.
“That’s the plan,” Price said. “They are still negotiating with vendors. They’ve asked me not to commit to a time line.”
She said at least one of the plant’s two paper machines will be retooled to produce linerboard for cardboard boxes.
It’s a heavier weight product than the paper for telephone books and newsprint that Nippon manufactured at the plant, which was built in 1920 as Washington Pulp &Paper Co.
Baez told the participants gathered in a large square of tables in a Pirate Union Building Student Center meeting room that McKinley proudly uses only recycled boxes for linerboard, not trees.
“That’s our raw material to make paper,” he said. “We don’t cut down trees.”
Also giving presentations at the luncheon were Darryl Wolfe, Olympic Medical Center chief financial officer; Elizabeth Court, Olympic Workforce Development Council director, and Jack Huls, vice president of student services at Peninsula College.
The Seattle chamber tour included stops in Bremerton, Poulsbo, Suquamish, and Finnriver Farm &Cidery in Chimacum before participants stayed nearly 24 hours in Port Angeles and finished their journey in Sequim.
The Thursday afternoon stop in Jefferson County was at Finnriver Farm &Cidery in Chimacum.
There, dinner was held and remarks on agriculture and economic development in rural Washington were given by Teresa Verraes, Jefferson County Chamber of Commerce executive director, and Jefferson County Commissioner Kate Dean.
After spending the night at the Red Lion Hotel in Port Angeles, participants attended a panel on the tourism industry, toured the Composite Recycling Technology Center, stopped by Magna Force Inc., and perched for a while on the Glines Canyon Spillway overlook.
Their final stop was Greywolf Elementary School in Sequim, where they took part in the program, “Cross-laminated Timber: The Future of Sustainable Forestry and High-rise Construction,” before returning to Seattle.
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Senior Staff Writer Paul Gottlieb can be reached at 360-452-2345, ext. 55650, or at pgottlieb@peninsuladailynews.com.
