"We've only been doing this a very short time," said company spokesman Kevin Scott, noting that the system was installed last week.
"But based on what I'm not smelling right now, I'm pretty hopeful.
"We hope this trial will address the vast majority of the odor from the pond."
The process is taking place in the 33-acre runoff pond where water from the mill is purified and then channeled into Port Townsend Bay at a rate of 12 million gallons daily.
The pond holds 60 million to 80 million gallons at a time.
The new system is installed on a pipe that leads into the pond.
The pipe is attached to a liquid oxygen tank, through which oxygen is injected at a rate of 3 tons per day.
The oxygen mixed with the water from the mill reduces the sulfur content and as a result the smell, Scott said.
The odor test is a condition of a state Department of Ecology wastewater permit for the pond that is to be issued in September, which requires that the test take place within the first two years of the permit.
The company is working ahead of that deadline, Scott said.
"We wanted to jump on this right away," he said.
"We want to reduce the odor as much as we can during the permit's early stages."
The second part of the test employs a machine known as a "Jerome Meter," which is to be taken to areas from which odor complaints originate and provide an objective measurement of the sulfur content.
Port Townsend Paper is spending $150,000 on equipment for the trial, plus $15,000 to $20,000 a month for the liquid oxygen.
If successful, local criticism of the mill will decrease because "most of the complaints about the mill have to do with the smell," Scott said.
Scott said that the odor reduction experiment is not related to the mill's proposed biomass facility.
The Port Townsend mill's $55 million, 24-megawatt biomass cogeneration expansion originally was expected to be put into operation last month, but work on the facility has been delayed until 2014 or 2015, the company said after a Dec. 10 state Court of Appeals ruling that sends a suit filed by five environmental groups to the state Supreme Court.
The suit - filed by PT Airwatchers, No Biomass Burn, the Olympic Environmental Council, the Olympic Forest Coalition and the World Temperate Rainforest Network - urges the requirement of an environmental-impact statement prior to construction of the expanded cogenerator that burns wood waste to create electricity.