CHILLICOTHE, Ohio – A Chillicothe paper mill that changed hands last fall is operating at a fraction of its former capacity and recently lost natural gas service due to a contract oversight, according to documents and a statement from the company.
US Paper Mill Company, LLC, took ownership of the former Pixelle Chillicothe facility last year. The transition has not been without problems. Columbia Gas discontinued service to the facility on March 13 after the company failed to renegotiate a natural gas contract it inherited from Pixelle, officials said. The original agreement required a level of gas usage consistent with large-scale paper production — far more than glove manufacturing demands.
“U.S. Paper Mill overlooked the need to renegotiate the contract with Columbia Gas, which exercised its right to discontinue service,” the company said in a statement released Friday through the Chillicothe Ross Chamber of Commerce. The company said it received a new service agreement from Columbia Gas the same evening and expected service to resume within days.
“This was an avoidable mistake by U.S. Paper Mill,” the statement said.
The gas disruption appeared to fuel speculation in the community about the facility’s future, prompting the chamber to publish the company’s statement directly.
Meanwhile, state environmental regulators this week approved a request from US Paper Mill to discontinue daily wastewater monitoring at the site. Ohio EPA’s Southeast District Office signed off on ending the testing after the company confirmed that equipment, tanks, and piping that once held black liquor, soap, and turpentine — industrial chemicals used in papermaking — had been emptied and flushed.
The scale of the operational slowdown is significant. Under Pixelle, the facility’s wastewater treatment plant processed chemical oxygen demand loads with action thresholds between 214,000 and 230,000 pounds per day. Since January 2026, average daily loading has fallen to roughly 3,100 pounds — less than 2% of the former baseline.
Despite the turbulent start, US Paper Mill says it has created more than 150 jobs since beginning operations and plans to bring additional employment to the region, according to the statement released through the Chamber of Commerce.
“U.S. Paper Mill is a new business that is still learning the complexities of operating in a 200-year-old facility,” the Chamber said in a social media post.
The facility has historically been one of Ross County’s largest industrial employers. Ohio EPA’s approval of the reduced monitoring comes with a condition that testing must resume if pulping or any other high-output process restarts.
Below are internal documents between U.S. Paper Mill LLC and the Ohio EPA: