Board OKs tax aid for project
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Dynamic Fuels, the $150 million alternative fuel project under construction in Geismar, will get a special $30 million tax break in a deal approved by a state board Tuesday.
The Board of Commerce and Industry approved the deal after a presentation by company officials for Syntroleum Corp. and Tyson Foods Inc., who are partners in the 75 million gallon-per-year refinery that will convert animal waste products into diesel and jet fuel.
The tax equalization agreement gives Dynamic Fuels LLC the same tax treatment it would have received in Texas City, Texas, had it located there instead of Ascension Parish.
After the meeting, Syntroleum executive Jeff Bigger said not getting the same treatment on income and sales taxes in Louisiana would have been a “deal-killer” and the project would have gone to Texas. Former U.S. Sen. John Breaux was among the private and public officials who worked to bring the project to Louisiana.
“Without the equalization, we probably would have lost this project,” Bigger said.
The Geismar plant, on property leased from Lion Copolymer, will start producing fuel early next year and reach full production by mid-2010. The company gained the tax-equalization break through 2014, when it would need to reapply to continue receiving it.
The board approved the deal with little discussion.
Steven Grissom, deputy secretary of the Louisiana Department of Economic Development, said LED recognized the Dynamic Fuels venture as an attractive way to bring the state into the alternative energy field. The deal “positions Louisiana for new growth in an exciting sector of the economy,” he said.
Dynamic Fuels has hired nine people so far and will reach 45 jobs at full employment, paying about $100,000 each in salary and benefits. Another 20 maintenance jobs will be created at the site. About 300 construction workers are building the refinery now.
Based on the performance at Geismar, additional refinery units could be built there and elsewhere. Bigger said Syntroleum, by next year, will install a demonstration refining project in China for Sinopec Corp., the state-owned oil and gas company that is that nation’s largest petrochemical producer.
In Louisiana, the company is testing jet fuel on B-52 aircraft at Barksdale Air Force Base, a process that could lead to business for the Geismar refinery.
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