Taiwanese petrochemical firm building $9.4B Louisiana plant
- Taiwan-based Formosa Petrochemical Corp. announced it will build a $9.4 billion manufacturing facility midway between New Orleans and Baton Rouge on a 2,400-acre site in St. James Parish, Louisiana, according to a press release from the office of Louisiana Gov. John Bel Edwards.
- Dubbed the Sunshine Project because of its proximity to the Mississippi River's Sunshine Bridge, the 10-year, two-phase development will see the construction of a "single-site ethylene hub" that will produce ethylene, propylene, ethylene glycol and related polymers under the banner of Formosa subsidiary FG LA LLC. The project, which could break ground as early as 2019, will employ 8,000 construction workers at its busiest.
- As an incentive, Louisiana is giving FG a $12 million grant to offset some of its infrastructure costs, payable beginning in 2021 as long as the company delivers on its job creation commitment. FG will also be able to tap the state's LED FastStart workforce development program and is expected to take advantage of Louisiana's Quality Jobs and Industrial Tax Exemption programs. In exchange, the plant is expected to generate more than $360 million in extra state and local tax revenue during construction and another $313 million during its first decade of operation.
The U.S. Gulf Coast has become a hot spot for petrochemical manufacturing operations, mostly due to the thriving domestic natural gas industry, according to the Houston Chronicle. Expansion and new-construction investments are routinely in the billions, creating thousands of construction jobs with each new project. Even Saudi Arabian companies are making the move to the Gulf Coast, the Chronicle reported.
For example, Gulf Coast Ventures, a joint venture between ExxonMobil and Saudi Arabian company SABIC, is planning to start construction on a $10 billion ethane steam cracker plant in San Patricio County, Texas, in 2019. The project still awaits permit approvals, but the JV expects that construction will create 6,000 jobs at the height of activity.
Gulf Coast Ventures also projects that the plant's building phase will be a $22 billion economic boon for the state of Texas. The project, like FG's in Louisiana, has also been the recipient of hundreds of millions in tax breaks, possibly more than $1 billion, according to The Guardian. These include a $531 million tax package from the local school board, the San Antonio Express-News reported, and $210 million from the county.
- Louisiana Office of the Governor Formosa Selects St. James Parish for $9.4 Billion Louisiana Project
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