Port Townsend Paper Co. faces $20,000 in fines after leaking pipes spilled wastewater into Port Townsend Bay on two occasions earlier this year, the state Department of Ecology (DOE) announced Sept. 18.

The mill’s parent company Atlas Holdings LLC, generates approximately $18 billion in revenues annually.

The mill, according to the DOE, has 30 days to pay the penalty or appeal it to the Washington Pollution Control Hearings Board.

The pulp and paper mill, according to the DOE, spilled approximately 1,000 gallons of condensed water from the plant’s steam system into Port Townsend Bay in early January of this year. In April, Port Townsend Paper Co. (PTPC) discharged approximately 114,000 gallons of untreated wastewater from the pulp and paper making process into the bay.

Brian Peterson, PTPC’s senior vice president of operations, said that on both occasions, the facility shut down its equipment and repaired the pipes that caused the discharge. 

The mill’s permit requires the facility to treat its wastewater before discharging it into the bay. Untreated wastewater may contain solids and pollutants that can harm fish, shellfish, and other aquatic life.

The paper mill’s most recent discharge violations aren’t the first time the state’s environmental regulators have sanctioned the company.

Between November 2021 and March 2022, PTPC spilled approximately 800 gallons of untreated process wastewater into Port Townsend Bay and exceeded the pollution discharge levels allowed in the company’s water quality permit 14 times. Those incidents led to a $27,000 penalty.

The paper company’s water quality permit requires the mill to treat its wastewater before ultimately discharging it into Port Townsend Bay. 

According to PTPC, those violations were a result of leaking pipes, equipment failures, and operational challenges caused by freezing weather.

Water quality penalty payments are placed into the state’s Coastal Protection Fund which provides grants to public agencies and tribes for water quality restoration projects. 

Port Townsend Paper Co. operates a large industrial wastewater treatment plant and a small sanitary wastewater treatment plant to treat water produced in the paper making process. The company’s current water discharge permit was issued in May 2025 and will expire in May 2030. The mill’s air operating permit was issued in Aug. 2022, and will expire in Aug. 2027.

With around 300 employees, the mill makes about 1,000 tons of unbleached paper, container board, and pulp each day. 

The Port Townsend Paper Company Mill was opened in 1928 by Crown Zellerbach. In the late 1970s and early 1980s, Crown’s timberlands and industrial operations were split apart during a corporate takeover attempt. In 1983, the West German company, Haindl Papier, purchased the mill. The company had 500 employees, including a bag plant.

In 1997, the mill was sold to Northwest Capital Appreciation (NCA), a Seattle-based equity firm, which recruited former Weyerhaeuser executive John Begley as company president. In 2001, Port Townsend Paper Co. purchased Crown Packaging of British Columbia.

In 2006, due to global recession and high interest rates on debt, Port Townsend Paper Co. declared Chapter 11 bankruptcy in order to reorganize its financial structure. In 2007, Port Townsend Paper Company emerged from reorganization, owned by its primary bondholder, Goldentree Asset Management of New York. On Feb. 10, 2015, Lindsay Goldberg LLC announced it was purchasing Port Townsend Paper Co. from Goldentree, forming Crown Paper Group. 

In October 2022, Atlas Holdings, LLC acquired Crown Paper Group and its associated entities, including the Port Townsend paper mill..

Atlas Holdings, headquartered in Greenwich, Conn., was founded in 2002. Atlas and its affiliates own and operate 27 companies, which employ more than 57,000 associates across more than 350 facilities worldwide. Atlas operates in sectors such as automotive supply, building materials, capital equipment, construction services, food manufacturing and distribution, metals processing, packaging, paper, power generation, printing, pulp, supply chain management and wood products.