The Record Newspapers - Hometown News For Orange County, Texas

By Dave Rogers
For the Record 

County, OF chase $6B gas plants

 

Last updated 5/24/2022 at 7:46pm

Orange County Commissioners voted unanimously Tuesday to establish a Reinvestment Zone south of Rose City that could lead to a $6 billion investment by Enterprise Products Co.

The county's action on the 1,800-acre property on the Orange County side of the Neches River should help convince the Barbers Hill company to build two projects on the site: a $5.25-billion ethane cracker and a $975-million export terminal able to process fully refrigerated ethane onto ships.

The location is within the Orangefield Independent School District and should generate an estimated $507 million in school taxes over the next 25 years, according to paperwork filed with the school district earlier this month.

The company and OISD agreed to partner on a "limit on appraised value" under Chapter 313 of the Texas Tax Code, which, according to the same paperwork, would save the refiner $466 million over 25 years.

The state requires a county to establish a Reinvestment Zone before a county or city tax abatement or Chapter 313 agreement comes into play.

And the reasoning behind state-supported incentives is to bring or create new businesses for the state. Enterprise Products, which already has at least three pipeline terminals or manufacturing sites on the east side of the Neches in Jefferson County, reported in its filings that it is considering other out-of-state sites in Louisiana.

"This is a great opportunity, not only for the school district but for the county," Dr. Shawn McAlpin, Orangefield schools superintendent, said.

It is expected Orange County will follow up Tuesday's action by granting a tax abatement.

In the case of a similar possible investment, both West Orange-Cove school district and Orange County granted abatements to Chevron-Phillips Chemical in 2019 following that company showing interest in building a $6 billion plant near the Orange County Airport.

The final investment decision, first expected in 2020, was delayed by the chaos resulting from the COVID-19 pandemic, and is still pending.

Enterprise Products paid Orangefield ISD two checks of $75,000, one application fee for each of its Chapter 313 filings.

Paperwork available on the OFISD website show that Enterprise only obligated itself to 10 new jobs, the minimum required to apply. It listed an average salary of $63,000 per year.

The application called for construction on the ethane cracker to begin in the second quarter of 2024 and for its first full year of operation to be 2028.

The export terminal plans to be online by 2025, its 313 application stated.

Those are only best case scenarios, of course. Enterprise Products could cancel the projects or locate them elsewhere.

"There's definitely economic opportunity if a project like this were to come to fruition," McAlpin said. "Obviously, there's economic opportunity during construction as well as after the establishment of the project."

Enterprise Products is one of the largest publicly traded partnerships and a leading North American provider of midstream energy services to producers and consumers of natural gas, NGLs, crude oil, refined products and petrochemicals, according to its website.

Services include: natural gas gathering, treating, processing, transportation and storage; NGL transportation, fractionation, storage and marine terminals; crude oil gathering, transportation, storage and marine terminals; petrochemical and refined products production, transportation, storage, and marine terminals and related services; and a marine transportation business that operates on key U.S. inland and intracoastal waterway systems.

The partnership's assets include more than 50,000 miles of pipelines; over 260 million barrels of storage capacity for NGLs, crude oil, refined products and petrochemicals; and 14 billion cubic feet of natural gas storage capacity.

 

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