China-Backed Company Envisions Major Methanol Export Plants at Kalama, Clatskanie

By Erik Olson, Tony Lystra, January 22, 2014, Longview Daily News

In what would be the biggest jobs boost for the region in nearly 20 years, a Chinese company plans to build two methanol export plants — at the Port of Kalama and at Port Westward near Clatskanie — potentially creating up to 480 permanent full-time jobs and 2,000 construction jobs over the next five years in the Lower Columbia region.

 

Initial reports suggested the jobs created would be half that, but during a Wednesday morning meeting with The Daily News, representatives of Northwest Innovations Works, a newly formed company with offices in Vancouver, said they plan to build plants that are twice as big as originally reported. Combined, the company plans to invest $3.6 billion in the region, or $1.8 billion at each site.

 

At the Port of Kalama, Northwest Innovation Works officials want to lease a vacant site north of Steelscape for one of the manufacturing facilities. The company also would require a natural gas pipeline to supply the plant. At Port Westward, Northwest Innovation is seeking to lease 82 acres for a similar, separate project.

 

The company is a joint partnership between the Chinese Academic Sciences and BP, formally known as British Petroleum. The two facilities will supply methanol to the northern Chinese city of Dalian, which uses the methanol to make Olefin, a key ingredient in manufacturing plastics, such as water bottles.

 

The plants will not use any raw material other than natural gas, which is converted through a chemical process into methanol, a liquid that evaporates easily. By contrast, many Chinese methanol plants manufacture the product using coal, a process that pollutes the air. Using natural gas is far cleaner and far more efficient, company officials said.

 

“We take natural gas and make a product out of it that is used to make things we touch on a daily basis,” Northwest Innovation Works President Murray “Vee” Godley III said. “Windshield washer fluid is 30 percent methanol.”

 

The company’s Chinese client is hungry for large quantities of the product, which would be shipped from the Columbia River ports on 50,000-metiric-ton Panamax ships to Dalian. Methanol does not require any pressurized or special handling technology, they said.

 

“We need to get to market fast,” Godley said.

 

He said Northwest Innovation intends to hire a union contractor to build the plants and intends to hire local workers to staff it. Lowest paid jobs would have salaries in the $40,000 to $50,000 range, but each plant also would employ a number of higher-paid engineers and professional workers. Company officials estimate the two plants will directly and indirectly create 1,000 permanent jobs in the region.

 

Cowlitz Economic Development Council President Ted Sprague said Wednesday that the project is just what Cowlitz County economic leaders have been trying to secure for years: It provides long-term employment, it’s environmentally sound, not just for the region but globally.

 

“This brings together all the best benefits of economic development. It’s a large capital investment, brings a lot of high-wage jobs, and exports a product. Plus, we like the green product,” Sprague said.

 

Asked why the company chose Kalama and Port Westward, Godley said, “These two ports fit our needs. You’ve got a good, strong workforce that’s local and needs jobs.”

 

Those involved with the deal stressed that the plans are in their earliest stages. Terms of lease with the Port of Kalama are still being worked out, and it’s unclear what sort of environmental and regulatory hurdles the company will face.

 

The two plants would provide the biggest employment boost for the region since the construction of Steelscape in the early 1990s. It likely would be the largest one-time private investment in the region’s history. In addition to jobs, the two plants would provide a significant boost in tax revenue for local governments, though a precise estimate was not immediately available Wednesday.

 

Northwest Innovation has not yet applied for building permits and must clear regulatory hurdles before construction begins. Company officials say the plant will release steam and trace amounts of carbon dioxide and nitrogen oxide.

 

Sprague said the company has been eyeing the region for four months and was attracted by the low energy costs.

 

Northwest Innovation Works is a subsidiary of the Chinese Academy of Sciences, a government-owned group that supports economic development projects worldwide.

 

Northwest Innovation officials are planning to seek permission to start preliminary work during a Port of Kalama commissioners’ meeting at 5:30 p.m. Wednesday. On Thursday, the company will present its Oregon plan to Port of St. Helens commissioners at 5 p.m. at the Clatskanie PUD building.

 

Previous plans to build a natural gas line to the Port of Kalama have met with protests from citizens along the proposed route, some of whom argue that landslides on the soft ground could cause a line to rupture.

 

 

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