Louisiana loses $10B petrochemical project to Texas
Louisiana economic development chief says the state is not discouraged by ExxonMobil Chemical Co. and Saudi Basic Industries Corp.’s decision to build the “world’s largest” ethane cracker plant in neighboring Texas.
Exxon and its Saudi partner, SABIC, announced today that they have chosen to build the roughly $10 billion, 1,300-acre plastics complex at a site near Corpus Christi.
Today’s decision ended months of speculation about which state would win the project, for which ExxonMobil and SABIC also reportedly considered sites in Ascension and St. James parishes.
“Texas is formidable competition. But so is Louisiana,” Louisiana Economic Development Secretary Don Pierson says in a statement. “We were a strong finalist for this project, and we are very proud of the case we made on behalf of our state. We’re also proud of our record of progress in continuing to attract significant chemical manufacturing projects.”
ExxonMobil and SABIC’s plant will produce components used to manufacture polyester, antifreeze, plastic bottles and food packaging products for emerging global markets. In a statement, ExxonMobil Chemical Co. President Neil Chapman calls the site selection decision a “significant milestone” for both the state of Texas and ExxonMobil.
The project is expected to create more than 600 direct jobs and as many as 3,500 indirect jobs for Texas. It’s also projected to generate $22 billion in economic output during the construction phase and more than $50 billion in economic output during the first six years of operations.
“Texas has shown the business world that our state is the place where innovation and ingenuity thrive,” Texas Gov. Greg Abbott says in a statement.
Though the state lost the ethane cracker plant, Pierson points to projects like Sasol’s $11 billion ethylene and chemical derivatives complex in Lake Charles and Lotte Chemical’s recent decision to move its headquarters from Texas to Louisiana as examples that show Louisiana is a top destination for energy projects.
“The serious consideration ExxonMobil Chemical and SABIC gave our state for their new ethylene production complex is evidence of that,” Pierson says.
He adds that Louisiana will continue to value its relationship with ExxonMobil, which accounts for nearly $500 million in Baton Rouge-area annual payroll and more than 6,600 direct and contractor jobs. After tax credits and rebates are subtracted, the company’s Louisiana operations have paid more than $1 billion in state and local taxes during the past decade, Pierson says.
“This is powerful economic development, with a global energy leader, that we will seek to grow in Louisiana,” he says. “We appreciate Louisiana’s extensive history with ExxonMobil that spans more than 100 years. We welcome the opportunity to pursue future projects with ExxonMobil and other energy companies that recognize Louisiana’s unique strengths in workforce, infrastructure, certified sites, competitive incentives and a positive business climate.”