Chinese show confidence in La. with $1.85B investment
In what officials say is China’s first major foreign direct investment project in Louisiana, Yuhuang Chemical today announced plans to build a $1.85 billion methanol manufacturing facility on the Mississippi River in St. James Parish. Yuhuang Chemical is one of 13 subsidiaries of Shandong Yuhuang Chemical Co. Ltd., which describes itself as a private, rather than state-run, enterprise.
In a joint press conference this afternoon with Gov. Bobby Jindal and Yuhuang Chemical CEO Charlie Yao, the company announced its investment will create 400 new direct jobs with an average annual salary of $85,000 plus benefits. Louisiana Economic Development says in a press release the project will create another 2,365 new indirect jobs in southeast Louisiana and surrounding areas.
At peak construction, the company estimates the project will employ 2,100 construction workers.
Construction is set to begin in 2016, with a planned in-service date of 2018 for the first phase of the project. Hiring will begin in 2015, with employment to reach 200 by 2017 and 400 in 2023.
“Our state continues to raise the bar for attracting high-quality, world-class foreign direct investment projects,” Jindal said at a press conference at Oak Alley Plantation near Vacherie. “Foreign direct investment projects add great value to our state by creating high-paying jobs, increased levels of international trade and extraordinary career opportunities for the families of Louisiana.”
LED says Louisiana is providing Yuhuang Chemical an incentive package that includes two performance-based grants: a five-year incentive totaling $9.5 million beginning in 2017 to offset construction costs and another $1.75 million over 10 years to partially defray costs of site development, including access to the Mississippi River. Yuhuang will also participate in the LED FastStart workforce training program and use the state’s Quality Jobs and Industrial Tax Exemption programs.
“Louisiana was the right choice for our company to locate our first operation in the United States,” Yao said. “This facility’s location fits well with our strategy to leverage the advantage that natural gas feedstocks provide.”
Yao added that the Louisiana investment is Shandong Yuhuang’s “first major step in becoming a global player in the petrochemical industry.” Engineering work will be performed by China Huanqiu Contracting & Engineering Corp. The methanol technology will be licensed from Air Liquide Global E&S Solutions.
Shandong Yuhuang Chemical Co. is one of China’s leading chemical companies, with total fixed assets of $5 billion, 2013 sales exceeding $4 billion and more than 5,600 employees. The company ranks No. 456 among the leading 500 Chinese companies and is No. 24 among the nation’s 25 largest chemical companies.