Momentive Specialty Chemicals Inc. announced this morning plans to spend $66 million to upgrade an existing plant in Geismar and build a new chemical production facility in Luling. The company says the investments will increase its production of formaldehyde for use by nearby chemical plants in the manufacture of other products.
The Luling plant is expected to begin operations in the first quarter of 2016, and the Geismar plant expansion should come online in the fourth quarter of next year. When completed, the plants will have the capacity to produce more than 400,000 metric tons of formaldehyde per year. Formaldehyde is used as a key additive and binding ingredient in the production of a wide variety of engineered wood products, such as oriented strand board, and in thousands of other chemicals and products, including herbicides and fungicides.
Louisiana Economic Development estimates the projects will create 13 new direct jobs, with an average annual salary of $82,300, plus benefits. Eight of the new jobs will be located at the new plant in Luling, with the five other new jobs located in Geismar. The investment is also expected to create 74 new indirect jobs in the plant areas. Construction at the two locations will result in an estimated 300 construction jobs.
Louisiana is providing the company an incentive package that includes a Modernization Tax Credit of $350,000, to be claimed over five years. The company also is expected to utilize Louisiana’s Quality Jobs and Industrial Tax Exemption programs as it hires employees and places the capital projects into service.
Momentive’s new plant in Luling will serve the adjacent Monsanto chemical plant by providing formaldehyde through a direct pipeline. The expanded plant at Geismar will have a direct pipeline delivery system into the adjacent manufacturing sites of BASF Corp. and Huntsman Corp. LED has more details on this morning’s announcement.
