HALSEY — Pope & Talbot, Inc., announced Monday that two British Columbia pulp mills will begin wind down procedures after the company’s creditors failed to extend its financing, but the company’s Halsey mill is not going through the same procedure according to company spokesman Mark Rossolo.

“At this time we are not in a wind-down mode in Halsey,” said Rossolo. “We won’t know what’s going to happen with the Halsey mill until tomorrow.”

Pope & Talbot is scheduled to appear in bankruptcy court in Vancouver, Wash. Wednesday morning for a hearing that will decide the fate of the financing for the Halsey Mill.

“Right now Halsey’s operations are normal,” added Rossolo.

A Canadian bankruptcy court gave Pope & Talbot a 48-hour extension of its bankruptcy protection on Monday as the company continued attempts to sell the mills.

Negotiations for a court-approved sale of the three pulp mills to Asian based PT Pindo Deli Pulp & Paper Mills for $105.3 million stalled Friday. Rossolo said the company is still trying to work out an agreement with Sinar Mas, PT Pindo Deli’s parent company. Based in Shanghai, China, Sinar Mas is the largest producer of pulp and paper in Asia.

Other options were also on the table according to Rossolo, including selling the three mills individually.

After filing for bankruptcy in Canadian courts in October 2007, Pope & Talbot filed for Chapter 11 protection in the U.S. in November.

Pope & Talbot’s bankruptcy was the third largest in the state’s history.

The company received an extension on its $89 million bankruptcy loan in order to complete sales. Three lumber mills were sold to International Forest Products Ltd. earlier this year. Pope & Talbot is still negotiating a $6 million deal with PT Pindo Deli for its Fort St. James sawmill in B.C.

The declining housing market, a stronger Canadian dollar and high debt levels have all contributed to Pope & Talbot’s problems.

Nearly 1,000 workers are employed at the three mills, including 180 at the Halsey mill.

In operation since 1968, the Halsey site produces pulp from sawdust and wood chips.