In a bid to “leverage our natural resource advantage to lead the world out of the global recession,” according to Cornerstone Chemical Co. CEO Greg Zoglio, his company along with Incitec Pivot broke ground on a $1.025 billion project today.
The project consists of construction of Dyno Nobel’s $850 million ammonia plant with Cornerstone Chemical’s $175 million investment in upgrades and infrastructure expansion at Cornerstone’s Fortier Manufacturing Complex in Louisiana. Incitec Pivot, based in Australia, is the parent company of Dyno Nobel, which is building a plant with an annual ammonia capacity of 800,000 metric tons.
Incitec Pivot manufactures a range of industrial explosives, fertilizers while Dyno Nobel manufactures industrial explosives and blasting services. Cornerstone Chemical Company manufactures key intermediate chemicals.
“This groundbreaking symbolizes the potential brought by the new energy economy in the U.S. Gulf and Louisiana, and along with the Cornerstone team I am excited to welcome Incitec Pivot as a key partner at our site,” said Zoglio.
“This project will be the first new ammonia plant built in the state in over 25 years and is a shining example of the changes in Louisiana made possible by the advent of shale gas and a growth-oriented state government” Zoglio added. “This project will be one of many that will upgrade natural gas and natural gas liquids to value-added chemicals primarily for consumption within the U.S.”
Dyno Nobel plans to begin ammonia production in mid- to late 2016, with Cornerstone Chemical Company completing six years of maintenance and infrastructure work that will help support the ammonia plant. The project will create 65 new direct jobs, with 60 new personnel at Cornerstone Chemical and another five employed by Dyno Nobel.
The Louisiana Economic Development organization estimates the project will result in another 477 new indirect jobs, for a total of more than 540 new jobs. The project will retain 441 existing Cornerstone jobs. In addition, Dyno Nobel estimates construction employment will peak at 750 jobs over the three-year construction period.
Dyno Nobel will develop the ammonia plant to support its U.S. industrial explosives business as well as external customers. Cornerstone currently produces acrylonitrile, melamine and sulfuric acid at the Fortier complex, where the ammonia plant will be integrated with Cornerstone’s existing plant infrastructure.
“This site at Cornerstone Chemical met our needs for a number of reasons: a competitive gas price, a responsive government regulatory process, a brownfield site and a professional business environment which combined, makes for a compelling investment in Louisiana,” said Incitec Pivot Limited Chairman Paul Brasher. “This plant will be the benchmark, the standard to which others hold themselves. Waggaman will be the place where other companies come to learn how to operate one of the safest and most-efficient ammonia production plants in the world.”
To secure the project, the state offered an incentives package that will include the Industrial Tax Exemption and Quality Jobs programs for Dyno Nobel. Cornerstone Chemical will receive a Modernization Tax Credit of $3 million to be claimed over five years, along with the services of LED FastStart, the nation’s top-ranked state workforce training program. Cornerstone Chemical also is expected to utilize the Industrial Tax Exemption and Quality Jobs programs.