Huntsman Corp. plans a $78 million investment at its Geismar, Louisiana, chemical facility which is expected to yield a 50-kiloton increase in the facility's output of methylene diphenyl isocyanate, or MDI, a key component of polyurethanes used in car seating, furniture and energy-saving insulation products. The investment will also fund extensive modernization of the facility's operations.
Louisiana Economic Development said the Huntsman expansion will create 17 new direct and 60 indirect jobs. In addition, the project will retain 397 existing jobs at the Geismar facility. An additional 100 construction jobs are expected to result from the project. The state's strong business climate, the Geismar site's competitiveness, its access to U.S. shale gas reserves, and the Louisiana location's strong logistics base provided an advantage over competing sites internationally, LED officials said.
The Geismar expansion is part of a global investment to support Huntsman's production of MDI, which is used in energy-saving insulation products, cushioning for car seating and furniture, footwear adhesives and other applications. With strong ongoing demand for MDI, Huntsman evaluated its polyurethane business and is increasing efficiency and production at its U.S. facility in Geismar, as well as at its facility in the Netherlands.
"The benefits of U.S. shale gas have significantly improved the economics of investing in U.S. facilities, and Huntsman has a number of other investments planned, which will take advantage of lower-cost natural gas," said Jon M. Huntsman. "In making these investments, Huntsman has benefited from the support of Louisiana Economic Development and Ascension Parish Economic Development. We thank them for their cooperation and support."
Gov. Bobby Jindal said, "Today's project is a great win for Louisiana. Huntsman evaluated its other facilities for this investment but chose Louisiana because of our strong business climate, incomparable workforce, energy infrastructure and access to shale gas reserves. Indeed, Huntsman is yet another company that will benefit not just from Louisiana's rich natural resources, but from our increasingly competitive business climate and world-class pool of workers. Louisiana is centered in the middle of a natural gas boom because of our access to shale gas reserves, and it's helping to create thousands of opportunities for our people."
LED's Business Expansion and Retention Group, or BERG, and regional economic development officials joined the company in initial discussions about the project in October 2012. To support Huntsman's expansion, the state offered an incentives package that includes a $1.5 million Modernization Tax Credit, payable over five years. In addition, the company is expected to utilize the state's Industrial Tax Exemption Program.