Investors Plan $2B Methanol Plant at Port of South Louisiana
On Friday, January 4, 2019, Louisiana Governor John Bel Edwards and South Louisiana Methanol CEO Paul Moore announced the revival of a plan for a new $2.2 billion methanol complex – one of the largest in the world - to be built in the Port of South Louisiana district.
The project, South Louisiana Methanol, is a partnership between New Zealand-based Todd Corporation and Saudi state-owned petchem firm SABIC. The project was originally announced in early 2013 as a joint venture between Todd Corporation and Texas-based ZEEP, Inc.
“This agreement represents part of SABIC’s strategy to focus on the geographic diversification of its business, to reach new global markets and enable the company to access raw materials at competitive prices. The Port of South Louisiana and in-place transportation infrastructure make St. James Parish a great location,” said Mohammed Al-Wakeel, head of SABIC US Methanol.
South Louisiana Methanol’s 1,500-acre complex in St. James Parish will use natural gas to produce an estimated 2 million metric tons of methanol per year. This petrochemical is used as a building block to make countless other products, including plastics, polyester fibers and fabrics, pesticides, fuel additives, pharmaceuticals and adhesives.
Abundant, affordable shale gas has led to the development of multiple methanol projects along the Gulf Coast, which could help make the U.S. a net exporter of methanol in the near future, according to a recent analysis commissioned by the Methanol Institute.
The state of Louisiana has renegotiated South Louisiana Methanol’s 2013 incentive package, which makes it eligible for a $5 million performance-based grant. The company will also receive assistance from the state’s LED FastStart, and Industrial Tax Exemption and Quality Jobs programs.