Stepan Co. to Build $60M-$70M Plant, Yuhuang Chemical to Invest $1.85B for Manufacturing Complex
- Jul 30, 2014
July has been a great month for the city of Baton Rouge and the state of Louisiana. Two chemical manufacturing companies have announced their plans to invest in the area and create hundreds of new jobs.
On Friday, July 25, Governor Bobby Jindal and Stepan Co. President and CEO F. Quinn Stepan Jr. announced that the Northfield, Ill.-based chemical manufacturer will invest between $60 million and $70 million to create a new chemical production facility in the existing industrial corridor of Ascension Parish. The company has recently authorized the feasibility work and will announce its final decision on the project in the second quarter of 2015.
In a news release, the governor said that if the project goes through, it would create 33 new direct jobs with an average annual salary of $70,000 per year. The Louisiana Economic Development also estimates that it will create an additional 98 new indirect jobs, as well as 65 construction jobs, during the development of the project.
LED started discussions with the Stepan Co. for a potential project in Louisiana in June 2012. The state offered an incentive package which includes a $500,000 performance-based grant to offset infrastructure costs. And Stepan Co. is also expected to use Louisiana’s Quality Jobs and Industrial Tax Exemption programs.
Stepan Co. is presently in negotiations for a manufacturing site in Ascension Parish. If the company decides to go forward with the project, work could start in the fourth quarter of 2015. Hiring would start in 2017 as the project nears completion.
“Stepan Co. is a highly successful chemical manufacturer that recognizes the tremendous business climate advantage Louisiana has over competing states. Louisiana now has more people working than ever before, and the best is yet to come because more companies like Stepan are considering investments in our state. Increasingly, the world’s leading businesses–from energy companies to advanced manufacturers and technology innovators–are choosing Louisiana and recognizing our state as the new frontier for business opportunity,” Governor Jindal said in a statement for the press.
On July 17, the Governor also announced that Yuhuang Chemical Inc., the North American subsidiary of China-based petrochemical group Shandong Yuhuang Chemical Co. Ltd., will invest $1.85 billion to develop a methanol manufacturing complex on the Mississippi River in St. James Parish, just outside the Baton Rouge metropolitan area. This is the first major foreign direct investment by a Chinese company in Louisiana.
Governor Jindal said construction is expected to begin in 2016, with the first phase of the project scheduled for completion in 2018. It will create 400 new direct jobs, with an average annual salary of $85,000. LED estimates the project will also generate 2,365 new indirect jobs and 2,100 construction jobs.
Yuhuang Chemical has secured an option to purchase more than 1,100 acres in St. James Parish. It has hired China Huanqiu Contracting & Engineering Corp. to develop the three-phase project. Hiring will begin in 2015.
LED began discussions with Yuhuang Chemical earlier this year, in February. The state offered two performance-based grants worth $11.25 million, and Yuhuang Chemical will also take advantage of the Quality Jobs and Industrial Tax Exemption programs.
“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. It’s no accident that we now have a record-high number of people working in Louisiana, and companies from around the world continue to make huge investments in our state. Our efforts reforming government, lowering taxes, and improving our state’s business climate are paying off. Louisiana truly is becoming the best place in the world to live, work and raise a family,” Governor Jindal said.