Oh no poor SASOL

I didn't realize the plant that just opened had been been grandfathered in to new ITEP rules.

So far, the Lake Charles chemical production plants have "quickly shown capability to run at full range," Thomas said.

Sasol's economic incentive application for the state's Industrial Ad Valorem Tax Exemption Program, known as ITEP, where companies get a 10-year property tax abatement, was grandfathered in when the program being revamped in June 2018.

They're paying zero in property taxes for 10 years (at least.) That's working well for them. So well, in fact, they are making plans to expand production.  Better look out, though. Under the new rules the next facilities will only be exempt from almost all of their taxes.

If Sasol follows through with plans for an expansion, the company would be eligible for no more than 80% of its property tax bill being forgiven for 10 years under new rules. That means local taxing entities would see a boost in property taxes during the first year.

But, again, it's going well for them and they're planning for expansion now even as they apply for exemptions under the new rules. So what is this even the point of this back and forth?

Sasol's executive was asked by a Commerce and Industry Board member whether the company would still be able to turn a profit if it had only been awarded a 10-year property tax abatement of only 80% rather than 100% when it planned the facility that is being built.

"If we had proposed a lesser incentive … I would have to run the numbers, but I can say this, it's much less likely that we would have (invested in Louisiana)," Thomas said

But you are applying for a new ITEP now.  Not gonna "run the numbers" on that yet? 

Update:  In a somewhat related matter, Governor Edwards, whose administration has overseen the expansion of heavily subsidized chemical facilities and oil and gas infrastructure held a campaign kickoff event today in New Orleans. According to Uptown Messenger there were at least three protesters on hand.

Qatar on the bayou

It's hard to crack into the WSJ archives. This was one of my very favorite op-eds of theirs that wasn't penned by Bobby Jindal.  That link runs up against the paywall, though.  I happened to pull the funny quote from it at the time. But also here is a site where the full text is preserved. Anyway, here is what I'm talking about.

So let’s put it this way: We are building a Qatar on the Bayou. From whole cloth, companies are laying new cities of fertilizer plants, boron manufacturers, methanol terminals, polymer plants, ammonia factories and paper-finishing facilities. In computer renderings, the Sasol site looks like a fearsome, steel-fitted Angkor Wat.

Now the environmental website where the text of this article is preserved has added photos, links and commentary to recontextualize things a bit. But in its original form it was pretty clear this  "Qatar on the Bayou" iteration was meant as a compliment.  Understandably, not everyone takes it as such. 

While the Sasol project described above has since been scaled back, the chemical boom in South Louisiana has nevertheless persisted... much to everyone's great excitement in St. James Parish.

CONVENT — Shouting "shut it down" on the front lawn of Mosaic Fertilizer's administrative office, a collection of St. James Parish residents, outside environmental activists and pastors called Wednesday for the state to close the Uncle Sam plant with its endangered lake of hazardous water threatening surrounding land and waterways.

Company officials and state regulators have been scrambling for several weeks to prevent a catastrophic release of more than 700 million gallons of the acidic process water held inside an enormous lake atop a 200-foot high pile of the company's waste byproduct outside Convent.

I've been watching this story all week and I'm still not sure if the "process water" threatens to contaminate the river if it slips loose.  I only ask because I am concerned it might not be so great at cooling turbines. 

More to the point, though...

More pointedly, the local group Rise St. James and other activists urged the state to halt continued permitting of any new industrial operations in St. James Parish, like the $9.4 billion Formosa complex proposed across the Mississippi River in Welcome or the $1.2 billion Wanhua complex proposed across the street from the Mosaic waste pile.

"As Rise St. James and as the residents of St. James have said repeatedly, St. James is full, and nothing shows it more clearly than this facility that needs to be shut down now," said Anne Rolfes, director of the Louisiana Bucket Brigade. "You can't handle what you got, don't bring in any more."

Gail Leboeuf, a Convent resident who grew up near the pile, said she watched the plant being built and watched the pile rise higher and higher through the years.

One could almost call it the Angkor Wat of gypsum if one wanted to keep the metaphor going.  But why would we want to do that?  It was all mixed up in the first place.  The Angkor Wat is in Cambodia and we're trying to be Qatar.. right?  Maybe we need to just stop.

Danger Exploding Area

Edwin Edwards may soon encourage you to "buy some dirt."

Former Gov. Edwin W. Edwards won approval Thursday from the Louisiana Real Estate Commission to apply for a real estate broker’s license.

The vote was 7-2.

The decision came after Edwards, 87, appeared before the commission to explain why it should allow him to prepare and sit for the licensing test. As a convicted felon, Edwards needed the permission of a majority of the 11-member commission to proceed.

Edwards said he thought the brokers license would help as he “works with some friends of mine” in the engineering, architecture and construction business trying to develop property along the Interstate 10-12 corridor from Lake Charles to Slidell.

He said the area is “ready to explode and development has already started.”

One thing that won't be exploding in the area is that Sasol plant Bobby Jindal said was going to blow us back to the 19th Century. ... at least not for now.   But there are plenty other highly poisonous and volatile industries situated along the corridor so Edwards definitely knows what he's talking about there.

Busted

Cheap oil continues to unravel the "Louisiana Miracle."

South African energy giant Sasol will delay making a final investment decision on its proposed gas-to-liquids plant in the Lake Charles area because of the collapse in oil prices.

Sasol will continue to work on the project although “at a much slower pace,” President and Chief Executive Officer David Constable said.

The gas-to-liquids plant makes up the bulk of an estimated $22 billion complex.

The GTL complex would produce more than 96,000 barrels of diesel fuel, naphtha and other chemical products each day. The facility would have created 750 permanent jobs.

Very high profile project. Could not have been more over-hyped.. although Bobby Jindal did try.. as Clay observed earlier.

Governor Jindal said, “We are proud that Sasol is following through with its commitment to invest in this historic manufacturing project, and that the company is developing a project to the highest environmental standards in our state’s history. Thousands of high-paying construction jobs will be created by this world-scale chemical project, and thousands more permanent jobs will result when this ethane cracker complex begins operating in just a few short years.

 

“Today, Louisiana is the epicenter of an industrial renaissance surpassing anything we’ve witnessed since perhaps the industrial revolution in 19th-century America. With projects like Sasol’s historic manufacturing investment in Louisiana, we truly are reaping the benefits of having the nation’s best business climate and a workforce that is second to none in the world. Indeed, Louisiana is the new frontier for business investment, and the best place in the world to live, work and raise a family.”

Guess we're gonna have to wait a little bit longer for the re-dawning of the 19th Century.  Bobby tried to welcome it back last weekend but it looks like nobody showed up for that.