BASF spending $150M to double MDI production at Geismar chemical complex

The Business Report

BASF will make an initial investment of $150 million to construct a new unit at its Geismar chemical complex as part of a plan to double its capacity to produce a chemical used in foams and other materials for construction, insulation, automotive and packaging goods.

The multi-phase project will take place over several years, BASF and Louisiana Economic Development say in a news release. The initial investment will cover the cost of constructing a methylene diphenyl diisocyanate, or MDI, synthesis unit at the complex. Additional production units are planned, and construction will start this spring, LED says.

“Manufacturing jobs are the backbone of our parish, and we appreciate the continued investment BASF is willing to make in the Geismar facility and the quality employment opportunities that the investment creates,” Kate MacArthur, president and CEO of the Ascension Economic Development Corporation, says in a statement released this morning.

The expansion will eventually double BASF’s production of energy-efficient MDI while creating new direct and indirect jobs for the region, notes Adam Knapp, CEO and president of the Baton Rouge Area Chamber. BASF plans to expand the production of MDI from 300,000 metric tons to almost 600,000 metric tons.

The project is expected to create 15 new direct jobs with an average yearly salary upwards of $86,600, plus benefits. LED also estimates the expansion will result in an additional 70 new indirect jobs, for a total of 85 new jobs in the Capital Region.

To secure the project, the state says it offered BASF a competitive incentive package that includes a $1.65 million Modernization Tax Credit, to be claimed in equal installments over five years. The company also is expected to use the Louisiana Industrial Tax Exemption and Quality Jobs programs.

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