BAUXITE, Ark. (AP) — The demand by oil and natural gas drillers for tiny ceramic particles led to an announcement Wednesday that a company plans to spend $100 million on a new factory in Saline County and to hire 140 new workers.
Saint-Gobain Corp. already makes the material at a plant in Fort Smith but needs a new factory so it can fill expanding orders, company officials said.
The announcement was made at the city museum in Bauxite, where about 200 people packed into the community room to hear Gov. Mike Beebe and others extoll the virtues of the proposed plant. The particles, known as proppants, are about the size of a grain of sand and are used to prop open fractures in rock during oil and natural gas extraction, a process known as fracking.
Sand is also used in the fracking process, but for deeper wells, such as in the Haynesville Shale in north Louisiana, the harder ceramic proppants are more efficient for sustaining the gaps in the fractured rock.
"As energy prices rise, you can appreciate how important it is to get as much as we can from each source," said Antonio Vilela, vice president and general manager of Saint-Gobain NorPro.
The primary material in the ceramic particles is bauxite, which is abundant in Saline County and which fueled earlier economic growth when Reynolds and Alcoa had a significant presence in the community. People driving to the announcement from the west could see a large, open-pit bauxite mine on the north side of Arkansas 183 standing out amid the pine groves and flourishing kudzu.
Vilela said the company has been working with state and federal regulators for six months to make headway on getting environmental permits to operate the plant. The company already has a raw materials operation in Saline County, which ships to the Fort Smith factory.
The Fort Smith facility, which employs 200 people, will "absolutely" keep running, Vilela said. The company recently spent $15 million to upgrade that plant, he said.
Vilela said the Saline County factory will mainly use rail lines for shipping and will strive to create a minimal disruption on local roads.
To help secure the plant, the state kicked in a sales tax rebate on building materials — a significant sum considering the plant's estimated $100 million price tag. Saint-Gobain will also receive a 1 percent income tax credit on payroll for new, full-time permanent employees for five years.
Additionally, Saline County will apply a $1.75 million Community Development Block Grant to help pay for equipment for the company.
Pulaski Technical College, which has a satellite campus in Saline County, will help with training workers, Beebe said.
Vilela said significant hiring will begin in May so workers can be trained for the anticipated plant opening late in 2012. Construction should start in about two months.
Bauxite has a population of 432, but as many as 7,000 people lived there during World War II, working to supply the war effort with aluminum.
Saint-Gobain already employs 400 people in Arkansas, including facilities in Fort Smith, Glenwood, Hot Springs, Little Rock and Nashville.
Saint-Gobain, which has been in operation since the 1600s, is headquartered in Paris and has operations in 64 countries, employing 190,000 people. The company had 2010 sales of $53.2 billion.