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School board clears way for $10 billion petrochemical plant

Posted April 13, 2017 by Silvia Zurita in Business, Business Valuation, Commercial, Construction, Construction News, Downstream, Energy, Engineering, Financial, Infrastructure, Midstream, Oil, Petrochemical

A $10 billion petrochemical complex north of Corpus Christi can move forward after a local school board faced down community opposition and unanimously approved millions of dollars in tax breaks sought by two of world’s biggest companies.

The Gregory-Portland School Board, after more than four hours of debate and deliberation Tuesday night, Tuesday voted 6-0, with one abstention, to approve tax abatements that would extend for more than 15 years, part of $460 million in tax breaks sought from local governing bodies by Exxon Mobil and Saudi Basic Industries Corp., or SABIC, a company owned by the government of Saudi Arabia. The San Patricio County Commissioners approved tax breaks on Monday.

The plant, the largest proposed in Texas, would create an estimated 11,000 construction jobs and 600 permanent ones and feature the world’s biggest ethane cracker, which processes a component of natural gas into ethylene, the primary building block of most plastics. Exxon Mobil and SABIC have not yet given the project the green light, but are likely to now that they have the tax breaks in hand.

The plant, located just outside the city limits of Portland and Gregory, sparked strong opposition in the communities, which together have fewer than 20,000 residents. The debate, as in many other cities and towns where major developments are proposed, turned on the question of whether the promised jobs and economic growth were worth the plant’s impact on the character and quality of life of the communities.

“I’ll get out of here,” said Tim Flinn, a school board member who opposed the project, but recused himself from the vote. “It’s not going to be the quiet little place it was before.”

Flinn said he recused himself because he lives less than a half-mile from the site and could stand to benefit financially because Exxon would guarantee the value of his home if he opted to sell.

Local business leaders argued that the project would boost jobs, the economy and the tax base.

Board members who voted for the tax breaks said they did so because they wanted to see the schools and communities get something out of the development. The school board could only prevent the tax break, not the project if Exxon and SABIC wanted to build it. Even with the abatements the schools would still receive an extra $1.6 million a year on average for more than 15 years to support their programs.

 

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