Louisiana Home to First US Ethylene Plant Built by a Japanese Company PPMG Consultants

Louisiana Home to First US Ethylene Plant Built by a Japanese Company

Shintech Inc. announced on April 22 that it will invest $1.4 billion to supply its Iberville Parish facilities with new ethylene production capacity.

Shintech Inc. operates in North America as part of the Shin-Etsu Group, the world’s largest PVC producer and one of the leading manufacturers of silicone and other specialty chemicals worldwide.

With approximately 5,700 acres on the Mississippi River southwest of Baton Rouge, Louisiana, Shintech operates plants in Plaquemine and Addis that chiefly produce polyvinyl chloride, or PVC, and vinyl chloride monomer, or VCM – the key ingredient from which PVC plastics are made. The latest $1.4 billion expansion will include installation of an ethane cracker at the Plaquemine complex and capital upgrades to connect the ethylene output to VCM and PVC production there. Shintech is near completion of an incremental expansion of its VCM, PVC and caustic soda capacity in Iberville Parish, while an affiliated company, SE Tylose, is building a new plant at the Plaquemine site to produce hydroxyethyl cellulose, or HEC – a key component of latex paints.

To secure the ethylene expansion, the State of Louisiana offered Shintech an incentive package that includes a $5 million performance-based grant to offset the cost of infrastructure improvements at the Plaquemine site, along with a $5 million Modernization Tax Credit, to be claimed in equal installments over a 5-year period. In addition, Shintech will receive the comprehensive workforce solutions of LED FastStart – ranked as the No. 1 state workforce development program in the nation – and the company is expected to utilize the state’s Quality Jobs and Industrial Tax Exemption Program.

“We at Shintech are very grateful for the understanding and cooperation of the State of Louisiana in many ways,” Said Shintech Chairman Chihiro Kanagawa. “Without it, we would not have been investing as much as $4.7 billion in the Louisiana facilities. Shintech and the State of Louisiana have built a wonderful relationship. We would like to further strengthen this wonderful relationship.”

Louisiana Economic Development estimates the project will result in 658 new indirect jobs, for a total of more than 750 new jobs in the Capital Region and surrounding areas. In addition, the company estimates 2,100 construction jobs will be generated by the project at peak building activity.

“This is the third major expansion announced by Shintech in Louisiana since 2008, and our partnership with this global chemical leader continues to strengthen,’ said Gov. Bobby Jindal.  “By providing an unrivaled manufacturing workforce, a top business climate and quality infrastructure along the Mississippi River, our state is helping companies like Shintech thrive and compete better in the global economy.”

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