Today, Gov. John Bel Edwards joined Republic of Korea Prime Minister Lee Nak-yon, Lotte Group Chairman Shin Dong-bin and Westlake Chemical CEO Albert Chao as they dedicated the $3.1 billion Lake Charles Complex of Lotte Chemical.
During the past three years, Lotte Chemical developed a $1.9 billion ethane cracker on-site with Westlake Chemical as a minority investment partner. In addition, Lotte Chemical built a $1.1 billion monoethylene glycol manufacturing plant and its new U.S. headquarters, which moved from Houston. The Lake Charles Complex, located at the junction of Interstates 10 and 210 in Lake Charles, created 265 new direct jobs, with 135 at the ethane cracker, 80 at the MEG plant and 50 at the headquarters building.
The average salary for new direct jobs is $75,500, plus benefits, for the ethane cracker, and more than $80,000, plus benefits, for the MEG plant and headquarters. In addition, Louisiana Economic Development estimates the Lake Charles Complex will result in over 2,300 new indirect jobs, for a total of more than 2,500 new jobs in Southwest Louisiana.
“The Lotte Chemical project, and its partnership with Westlake Chemical in Lake Charles, demonstrates the best of what the world’s brightest minds can create in Louisiana,” Gov. Edwards said. “The project began with a partnership to produce a commodity chemical, ethylene. It continued with a decision by Lotte Chemical to produce a downstream derivative, monoethylene glycol. And the project culminated with Lotte Chemical’s decision to move its U.S. headquarters from Houston to Lake Charles. At one site, we have the major building blocks of chemical manufacturing and a company headquarters. In a similar vein, Sasol moved its research and development operations to Lake Charles before building one of the world’s largest chemical complexes here in recent years. Lotte Chemical’s investment in Lake Charles further burnishes Southwest Louisiana’s reputation as a global destination for major manufacturers.”
The Lake Charles project reflects Lotte Chemical’s goal of becoming one of the world’s top seven global chemical producers.
“Among Korean petrochemical companies, Lotte Chemical is the first to locate a project in the United States; as such, this project represents a significant investment by Lotte Chemical,” said President and CEO Jinkoo Hwang of Lotte Chemical USA. “Today also marks the opening of our new corporate headquarters in Lake Charles, and we are very excited to be part of the industrial growth in the region.”
During the first three years of operation, Westlake Chemical has the option of buying up to a 50 percent equity stake in the ethane cracker portion of the complex, which would secure receipt of 50 percent of the 1 million tons of ethylene produced annually. Operating in Louisiana for more than three decades, Westlake acquired the Axiall plant (formerly PPG chemicals) near the Lotte Chemical site two years ago. With additional major plant locations in Sulphur, Plaquemine and Geismar, Westlake Chemical employs more than 3,200 people in Louisiana.
“For Westlake Chemical, this new production facility marks another phase of our continued investment in Louisiana,” said company President and CEO Albert Chao. “The site of the ethane cracker joint-venture is located just west of one of our largest chemical manufacturing facilities. The new facility will be the seventh Westlake operation in Louisiana.”
A groundbreaking event launched the development of the Lake Charles Complex in June 2016, with the project generating over 3,000 construction jobs on-site as the three facilities were built.
“Collaboration for success is a phrase that comes to mind when I think about this project,” said President Kevin White of the Calcasieu Parish Police Jury. “Continued investments in Calcasieu Parish by leaders in the industrial sector like Lotte and Westlake Chemical facilitate the continued economic success in our region, which continues to serve as a global energy hub.”
Westlake Chemical plans to use its portion of the ethylene output to make vinyl chloride monomer (a precursor to plastics), along with other products, such as caustic soda, chlorine and ethylene dichloride. Lotte Chemical will make monoethylene glycol, commonly called MEG, which is an important ingredient in the making of paper, textile fibers, latex paints, asphalt, resins, antifreeze, coolants and adhesives. The Lotte Chemical site is expected to be the largest MEG plant in the U.S.
“Southwest Louisiana welcomes Lotte to our region,” said President and CEO George Swift of the Southwest Louisiana Economic Development Alliance. “We are proud to have this international company in our state. We are especially pleased to have their corporate U.S. office locate here. We look forward to a long relationship with Lotte.”
Louisiana faced competition for the projects, including from Texas for the ethane cracker, and Texas and South Korea for the MEG facility. To secure the projects, the State of Louisiana offered the companies a competitive incentive package that includes a Modernization Tax Credit of $4.55 million for the ethane cracker project. Both projects received the comprehensive solutions of LED FastStart®, the top-ranked state workforce training program in the nation. They received Economic Development Award Program incentives of $700,000 for the ethane cracker and $1.47 million for the MEG facility to offset site infrastructure improvements. In addition, the companies are expected to utilize Louisiana’s Quality Jobs and Industrial Tax Exemption programs.
About Lotte Chemical
Lotte Chemical is a member of the Lotte Group in Korea, which has been listed on the Korean Stock Exchange since 1991. Lotte Chemical is a leading manufacturer of petrochemical products, such as ethylene, propylene, butadiene, polyethylene, polypropylene, ethylene oxide/glycol, compound resin, polyethylene terephthalate, polycarbonate, methyl methacrylate, ethylene oxide derivatives, benzene, toluene, mixed xylene, purified terephthalic acid and purified isophthalic acid, among others. Lotte Chemical, headquartered in Seoul, has manufacturing facilities located throughout South Korea, China, Malaysia, Indonesia, Pakistan, the U.K. and the U.S. For more information, visit LotteChemical.com.
About Westlake Chemical
Blending chemical capabilities with a strong, downstream building products business, Westlake delivers life-enhancing products that benefit lives every day. From polyethylene that is used daily in food packaging like bread bags, cheese wrapping and milk cartons, to PVC pipe used to deliver clean drinking water or to irrigate fields, Westlake products make a difference in the world. Westlake employs 9,400 people at 35 locations in North America, 11 in Europe and six in Asia. For more information, visit Westlake.com.