County courts gas plant
Friday, December 19, 2008
By APRIL M. HAVENS
gulflive.com
PASCAGOULA A $2 billion energy project could find a home at the former International Paper site in Moss Point, local leaders said Thursday at a special meeting of the Board of Supervisors and Port Authority.
Supervisors and Port Authority commissioners jointly approved a lease option agreement for Mississippi Gasification, a wholly owned subsidiary of New York-based Leucadia National Corp.
The agreement allows the company to apply for $800 million in loans from the U.S. Department of Energy, said George Freeland, director of the Jackson County Economic Development Foundation.
The project has already secured $300 million in Go-Zone bond financing from Gov. Haley Barbour, Freeland said. Gulf Opportunity Zone bonds were created by Congress to foster post-Hurricane Katrina recovery efforts.
Leucadia recently received Go-Zone funding for a similar project at the Port of Lake Charles in Lake Charles, La., according to a report on the parent company's Web site.
The Moss Point facility would produce about 123 million cubic feet daily of substitute natural gas, which would be distributed along major natural gas pipelines. Substitute natural gas is made mostly of methane and is chemically similar to natural gas.
SNG is created by gasifying petroleum coke, a byproduct of oil refining that is primarily composed of carbon.
Thursday's resolution said the port will collect $11,100 monthly for 36 months during an initial term. Then, if Mississippi Gasification secures financing and permits, it will lease the 185-acre parcel for $650,000 yearly for 50 years, with optional extensions.
The company has been in talks with Jackson County leaders for nine months, Freeland said. The Mississippi Gasification project must gain DOE approval and undergo permitting processes, but Freeland described himself as "cautiously optimistic" about its success.
The facility would create 250-300 permanent jobs and about 2,000 construction jobs, Board of Supervisors President John McKay said. It could generate $10 million a year in tax revenues for the county, $8 million-$10 million for the Moss Point School District, and up to $6 million for the city of Moss Point, he said.
"I'm just glad to see somebody interested in that piece of property," Supervisor Tommy Brodnax said.
Port Director Mark McAndrews noted that the port purchased the property five years ago this month. "Five years is a good turnaround," he said.
In that time, the old paper mill was demolished, and the property was used temporarily for debris after Katrina in 2005, he said.
More recently, Chevron Corp.'s Pascagoula refinery has been leasing 40 acres there for a parking and other purposes.
Construction of the facility would take three years, said Jim Madole, an energy consultant serving as the project representative for Leucadia. Permitting and planning could tack on another two and a half years to the total timeline.
Moss Point Mayor Xavier Bishop said the city is "very encouraged indeed" about the project. The city's main considerations include the project's relatively minimal environmental effects and the city's interest in building a relationship with the industry.
Freeland said the county will know if the project will proceed after the company submits its final application to DOE in March. |
