McAuliffe says he’s mill finalist

Published 8:38 am Friday, April 23, 2010

WAKEFIELD—Former Democratic gubernatorial candidate Terry McAuliffe said Wednesday that his consortium is one of “a couple” of final bidders in the running to purchase facilities at the International Paper Co. mill in Franklin.

“They’ve narrowed it down to a couple of bidders and I’m one of them,” McAuliffe said at the Shad Planking festivities in Wakefield. “We’ll see what happens. The good news is that the paper mill will stay in existence as a new type of energy entity.”

McAuliffe and a group of investors including Peter O’Keefe, a longtime political ally, made an offer to purchase some or all of the infrastructure at the mill to convert it into a biomass energy power plant.

O’Keefe serves as the non-executive director for Leaf Clean Energy Co., which was incorporated in the Cayman Islands in 2007. According to the Web site for Leaf Clean Energy, the company’s portfolio includes businesses involved in the production of cellulosic and sugar cane-based ethanol, solar, wind and hydroelectric power, wood-fueled biomass, waste-to-energy gasification and landfill gas-to-methane.

IP officials did not confirm Thursday that McAuliffe, O’Keefe or Leaf Clean Energy were among the final bidders for the mill facilities.

“If we get it, if someone else gets it, the good news is (the mill) has got a future,” McAuliffe said. “When I got involved, it created a lot of excitement and I think it encouraged a lot of people to bid. If I get it, I’ll be excited. But if I don’t, I’ll know that at least jobs are going to be retained.”

Lisa Perry, the director of the Department of Economic Development in Isle of Wight County, said three or four groups could be final bidders.

“We’re not working with all of them,” Perry said Thursday. “Some of those petitioners have not solicited the help of the community and they are dealing exclusively with IP.”

Perry declined to identify any of the other groups petitioning IP, but did say they are not from out-of-state. She also indicated that the other bidders involve big companies.

“No one entity is going to be able to maximize the use of the facility,” Perry said. “It’s going to take a consortium of users. There are some big players still involved that we have been working with closely that have truly amazing concepts on the table.”

McAuliffe’s group, Perry said, “is going to have some tough competition, but that’s great because that means we’ll have a better user in the end.”

McAuliffe said he didn’t know who the other bidders are, but said, “We have had to expand our bid to bring in some other elements, to incorporate other parts of the paper mill, and I know the other side has done the same thing. There’s going to be a lot of new, green, alternative energy activities there, which is great.”

Asked for a ballpark figure on how many jobs could be created at a repurposed IP site, Perry said, “We’ve heard numbers that vary. They seem to hover around 400 to 500 persons, with varying degrees of skill required. But it’s not clear what the breakdown (of skilled labor) would be.”

McAuliffe declined to reveal additional details about the bidding process, citing a confidentiality agreement with IP, but he predicted that the Memphis-based company would make a decision on which assets to sell to which bidder very soon.

“I think that by the end of April, (the final bidders) pretty much have to have their next bids in, and then (IP) will make a decision shortly thereafter,” McAuliffe said.

IP has not disclosed how many unsolicited proposals for possible reuse of the plant were received before a Feb. 26 deadline, but local elected and economic development officials have said that as many as 15 renewable energy companies have negotiated with the paper maker. IP has given tours of the Franklin mill to many of them.

“The good news is that this is going to be an ongoing concern,” McAuliffe said. “IP has historically just shuttered their (closed) plants. This one will be a new model for them by keeping it open.”