Taiwan-based petrochemical giant Formosa Petrochemical Corp has selected St. James Parish in Louisiana for a US$9.4 billion chemical manufacturing complex, the office of Louisiana Gov. John Bel Edwards announced.
Formosa has purchased a 2,400-acre site along the west bank of the Mississippi River, where the petrochemical group plans to build a chemical complex that would produce ethylene, propylene, ethylene glycol, and associated polymers.
Formosa plans to operate the complex under its subsidiary and Louisiana registered company, FG LA LLC, and is branding the site as "The Sunshine Project."
Once it receives the completion and approval of permits for the site, FG could start construction as soon as 2019 in what would be a ten-year building and development process in two phases.
The Sunshine Project is expected to create 1,200 new direct jobs averaging $84,500, plus benefits, while Louisiana Economic Development estimates the project also would result in 8,000 new indirect jobs, for a total of more than 9,000 jobs in the River Parishes and surrounding regions of Louisiana.
"The new Sunshine Project continues that bridge into a brighter economic future for Louisiana, one with an estimated 8,000 construction jobs at peak, even more permanent jobs upon completion, and a multibillion-dollar impact on earnings and business purchases for decades to come. As a major global manufacturer based in Taiwan, Formosa has operated in Louisiana for several decades, and we applaud the company's responsible and thorough approach to developing this project," Gov. Edwards said.
Formosa Plastics Group currently operates three facilities in Louisiana employing 410 people in East Baton Rouge and Pointe Coupee parishes.
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"Given the history of St. James Parish, this will be the largest industry ever welcomed," Parish President Timmy Roussel said. "This plant alone will almost double the present tax base."
The State of Louisiana has offered Formosa an incentive package that would include a US$12 million performance-based grant to offset infrastructure costs. Following company performance in building the complex, FG would receive the grant in four annual installments of US$3 million beginning in 2021, the expected first year for hiring permanent jobs.
According to an economic impact study by LSU economist James Richardson, the construction period will result in US$362 million in new state and local tax receipts, and an additional US$313 million in new state and local taxes during the initial ten years of operation, beginning in 2025.
The project is forecast to result in US$4.7 billion in new personal earnings and US$18.5 billion in new business transactions through 2035.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. More