A pair of Chinese companies recently announced two separate chemical plant projects slated for Louisiana that will be worth billions.
The first announcement came last week from Wanhua Chemical Group, one of the world’s largest producer of methylene biphenyl diisocyanate (MDI). After years of negotiations with Louisiana Economic Development (LED), the company landed a $4.3 million infrastructure grant to build a $1.12 billion chemical plant.
The company has yet to pinpoint an exact location for the complex but says it will be used to manufacture MDI, which is most often used to produce the kind of rigid polyurethane found in thermal insulators for freezers and refrigerators.
LED said that the project could produce as many as 170 direct and 945 indirect jobs.
Yuhuang Chemical Inc. also announced last week that it could end up spending billions more than projected to complete its current methanol project in St. James.
The company started work at the 1,300-acre site earlier this year and had originally estimated it would require $1.85 billion to finish construction. Now the company estimates the project will cost about $3 billion.
According to local media, Yuhuang projects that the first phase of construction will take three years and create as many as 1,200 jobs. Once the methanol plant is operational, the company plans to hire around 100 employees with an average salary around $85,000 a year.
The company also responded to public concerns about air pollution by asking the Environmental Protection Agency for an air permit with stricter rules on specific pollutants.
Chinese companies are being lured to the Gulf Coast region by the abundance of natural gas. A local economist recently commented that it is typically cheaper for the companies to make products in the U.S. and then ship those products to China, than to ship liquefied natural gas to Chinese plants.
The American Chemistry Council has estimated that as of March, about 62 percent of the 294 chemical projects that have been announced in the U.S. is from foreign companies. Those projects are valued at $179 billion.