Today, Louisiana learns that policy matters. The state has now lost on a $10 billion ExxonMobil plant that will now head to Texas.
From The Advocate:
The battle between Louisiana and Texas for ExxonMobil Chemical Co. and Saudi Basic Industries Corp.’s “world-scale” petrochemical complex is over, and Texas won.
The partners have chosen a site in San Patricio County, Texas, for the proposed petrochemical plant, which will provide the building blocks for polyester, anti-freeze, plastic bottles and food packaging.
The proposed multibillion-dollar investment would include an ethane steam cracker capable of producing nearly 2 million tons of ethylene a year. If built, the project would create 600 full-time jobs, 3,500 indirect jobs and support thousands more jobs during the construction phase. It also is expected to generate more than $22 billion in economic output during the construction phase and more than $50 billion in economic output during the first six years of operations.
One of the reasons why Texas won over Louisiana is because the state has a more stable business climate. While Louisiana is threatening to raise taxes and increase lawsuits against oil companies, Texas is cutting taxes and welcoming them with open arms.
The Grow Louisiana Coalition sent out a statement blasting Louisiana’s business climate.
Following is a statement from Grow Louisiana Coalition Executive Director Marc Ehrhardt regarding ExxonMobil’s announcement to develop a petrochemical plant in San Patricio County, Texas, which will generate more than $50 billion in economic output during the first six years.
“More states are competing for energy investment than ever before. Companies of all sizes and types are looking for business, legal and tax climates that are fair, impartial and predictable. Investors want to know what they are getting when investing billions of dollars in an economy.
In Louisiana, we are fighting headlines such as ‘Texas Set to Repeal the Most Terrible of Taxes, while Neighboring Louisiana Looks to Impose It.’ Morgan City Mayor Frank “Boo” Grizzaffi summed it up earlier this month: ‘We’ve got legacy lawsuits out there, we’ve got an unstable budget and our taxes are too high…We’re at a disadvantage. Our neighboring states, Mississippi and Texas, they’re open for business. Here in Louisiana, we’re just in financial trouble.’
An owner of a small oil and gas service company, State Rep Blake Miguez (R-Erath) added in a LAGOP press release, “I hope this will serve as a wake-up call that we are sending a clear message that Louisiana is closed for business. This is a major disservice to the great companies that have always been here serving our communities as well as to our citizens working in the oil and gas industry. They rely on a stable environment for their livelihood.”
While Louisiana’s lawmakers are looking to raise taxes and regulations, Louisiana’s neighbors are noticing. They’re licking their lips as they benefit.