The Blue Jays signed right-hander Octavio Dotel to a one-year, $3 million contract, with a club option worth $3.5 million for 2012, on Tuesday.

During the 2010 season, Dotel posted a 4.08 ERA and 22 saves with the Pirates, Dodgers and Rockies. The 37-year-old experienced a decline in velocity, but he still throws in the low-to-mid 90s, and he recorded 75 strikeouts in 64 innings last year.

The Dominican native likely will become the early favorite to replace closer Kevin Gregg, who has agreed to a two-year contract with the Orioles. The 32-year-old Gregg recorded a career-high 37 saves for Toronto in 2010, while posting a 2-6 record with a 3.51 ERA. Gregg also struck out 58 batters over 59 innings, but at times he struggled with his control and allowed 30 walks.

The Blue Jays' search for a closer officially began last month when the club declined to pick up a pair of options on Gregg's contract. Toronto could have exercised a one-year club option worth $5.25 million or a two-year club option worth $9.5 million.

Dotel will be thrown into the mix to replace Gregg, but it's doubtful the Blue Jays will annoint him as the official closer prior to Spring Training. Dotel will also receive competition from right-hander Jason Frasor and left-hander David Purcey. It's a similar situation to last year when Gregg battled it out with Frasor and left-hander Scott Downs.

"Everybody would like to have a clear-cut guy, but last Spring Training we had a competition for that role and we ended up with a guy who had 37 saves," general manager Alex Anthopoulos said last week. "I think everyone would tell you they'd like to have someone in a defined role, but if it ends up being a competition, we're OK going into Spring Training with that scenario."