Former Madison, Maine mill receiving equipment as timber tech firm preps for unique use

MADISON, Maine (From news reports) -- Significant progress has been made at the former Madison Paper Industries mill under its new leadership.

By summertime, manufacturing equipment will be on its way to the Madison site, now called Timber Pure Technologies.

Delivered to Searsport from Germany over the weekend, the equipment will remain in storage at Mack Point on Sears Island until mud conditions change. The cargo ship Alamosborg, registered in the Netherlands, delivered the shipment.

GO Lab president Josh Henry, in a phone call on Tuesday, said that the delivery was initially set for 2020 but was delayed due to the coronavirus pandemic.

"We got that equipment from a manufacturing plant, like this one, in Germany," Henry said. "It's in storage containers right now and it will be stored (in Searsport) for a few months, when we're ready to take it on."

The equipment comes from Homanit Building Materials GmbH & Co., which offered the equipment to GO Lab at a discounted price to help expedite North American production of wood fiber insulation. Henry said the equipment is "very large" at about 500 feet, or about the length of two football fields when fully assembled.

GO Lab Inc., a Belfast-based building products manufacturer, closed on the $1.9 million deal to buy the building in 2019. The listing price was $2.5 million.

Timber Pure Technologies will make three types of wood fiber insulation, called EM Board, EM Batt and EM Pack. Wood fiber insulation has been on the market in Europe for more than two decades but never before in North America, according to Henry.

The GO Lab project will be the first of its kind in North America.

Madison Paper Industries shuttered in May 2016. The loss of the mill was a blow to the town's tax base, and officials are still fighting a request for abatement from Madison Paper, which states the mill was assessed for more than it was worth and wants a tax refund.

The sale of the mill to GO Lab was announced just over three years after Madison Paper announced in March 2016 it would close, putting 214 people out of work in May that year and adding to a string of paper mill closures around the state.

Henry said on Tuesday that at full production, the mill will employ about 120 people.

"We've had a great working relationship with the town of Madison," Henry said. "They're very aware of what we're doing, and we've been keeping in contact with them."

He added that the company is in the final phases of finishing off the equity piece and doing its "due diligence on the financing piece."

"We believe that we're basically a few months away from completing that financial piece that we're pretty deep into," he said.

As for funding the $110 million project, Henry said that they've received support from community development organizations including Maine Technology Institute, Coastal Enterprises and the Finance Authority of Maine, which have funded aspects of the project. They've also raised funds for the project through their team and private investments.

"This project requires $30 million of equity to leverage an additional $80 million in financing. We've raised about $25 million," Henry said. "It's taking quite a bit of time, but I think for good reason. This amount of money is a huge responsibility, and it's worth taking the extra time to make sure that we've done everything that we need to do in terms of engineering. It's really helped us think more about our process and get more invested with the state and community stakeholders. I feel like we're in a really good place."

At the Madison site, Henry added that much progress has been made since the 2019 purchase of the property. One of the benefits, he added, was that three of the top engineering staff members at the former paper mill joined the GO Lab team and "really helped us protect the manufacturing infrastructure that was there that had a lot of value."

At the time of purchase, the paper machine that existed in the building had been entirely moved out, which worked to GO Lab's advantage as it allowed the new owners to retain "all of the functional infrastructure," including water, heat, electrical and water treatment.

"We were able to save that and that's a huge win for us," Henry said. "In my estimation we've saved over $10 million of our capital budget."

Since then, the company has worked with Kennebec Salvage in Skowhegan in an ongoing scrapping operation to continue to clean up the mill and work on projects throughout the site. To date, he said that the inside of the mill site is in pristine condition. On the outside, the crew worked to demolish exterior buildings that were no longer of use, including an old boiler house and chemical building that were used for the paper-making process.

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