West Sacramento’s Origin Materials Inc. has reached an incentive deal estimated to be worth more than $100 million to build its second carbon-negative plastic plant.
The 150-acre facility will be in Geismar, Louisiana, just south of Baton Rouge. It's expected to create 500 construction jobs and 200 full-time positions at the plant, along with 500 to 1,000 indirect jobs.
“The local talent is world-class across refining, forestry and agronomy, feedstock logistics and chemicals,” said John Bissell, co-CEO of Origin, in a news release.
Geismar is on the east bank of the Mississippi River, so it has access to barge and rail transportation, and the area has plentiful wood residue as a feedstock, he said.
Origin (Nasdaq: ORGN) uses patented techniques to make wood extracts that replace petroleum to make plastic. Origin’s product is a drop-in replacement for petroleum in the manufacture of PET plastic, which is the most recycled plastic on the planet. Origin’s product allows existing manufacturers of everything from bags and bottles to clothing and carpet to use a renewable product that is identical to the current petroleum-sourced plastic. Origin's process also captures carbon, and it is cost competitive with petroleum, Origin says.
“Their unique process of developing PET products from renewable wood fibers is yet another example of how the global shift toward sustainability can be a catalyst for economic investment and job creation in our state,” said Louisiana Gov. John Bel Edwards, in a news release. ”The company’s carbon-negative mission aligns with our Climate Action Plan’s approach to limiting the severity of climate change while maintaining economic competitiveness in a low-carbon future."
Origin said the pending state and local incentives are estimated to be worth more than $100 million. Additionally, the state of Louisiana is working on authorizing private activity bonds of at least $400 million, Origin said. Private activity bonds are tax-exempt bonds authorized by state or local governments to finance qualified projects with private investment.
Origin has partnered with global manufacturers and manufacturing groups to develop its business. The company went public in June in a merger with a special purpose acquisition company.
Origin’s first plant has been under construction since last fall in Sarnia, Ontario, just over the Canadian border from Michigan. Bissell has said the company chose that location because of the access to local wood products and a legacy of workers in the timber industry. Sarnia, just north of Detroit, is on the southern edge of Lake Huron with access to shipping and rail transportation.
