Phase one of the project, which is being managed by WRAP on behalf of the UK and Irish governments, has got under way.
The research is being conducted by paper specialists Pira and Finnish consultancy Jaakko Poyry while local business knowledge is being provided by The Circa Group and Initiative Economic Development.
It is assessing mill options and covers the consumption and demand of paper, the sources, volume and markets for recovered paper and the options to use recovered paper including the capacity and type of mills.
If phase one is successful then the project will move on to phase two, a detailed feasibility study on the preferred mill or mills proposed.
Details of the study were first revealed earlier this year.
Irish paper mill under review
The first phase of a feasibility study into the construction of a recycled paper mill in Ireland began this month.