BASF plans MDI production expansion

Halen Doughty
Bird's eye view of BASF Geismar site.

BASF is gearing up to expand its methylene diphenyl diisocyanate, or MDI, capacity at the Geismar facility. Louisiana Economic Development (LED) announced the expansion will result in a $150 million investment and 85 new direct and indirect jobs.

The chemical complex plans to expand MDI production from 300,000 metric tons to almost 600,000 metric tons. MDI is used to produce polyurethane foams and materials for construction, insulation, automotive, and packaging goods.

The expansion is expected to take several years to complete, and the project will be done in phases. The first phase includes the initial $150 million investment in the construction of an MDI synthesis unit. Further production units are planned for later phases, and construction is slated to begin this spring.

“Louisiana excels in chemical manufacturing because of our outstanding infrastructure, a great business climate and a manufacturing workforce that leads the U.S. in productivity,” Governor John Bel Edwards said. “We’re proud that BASF is choosing to reinvest in its Geismar complex, which is one of the biggest economic drivers in Louisiana and one of the leading sources of highly skilled manufacturing jobs. Ascension Parish and the Capital Region of Louisiana will be major beneficiaries of this important modernization project.”

The investment will create 15 new direct jobs with an average salary of more than $86,000, plus benefits. LED estimates the expansion will result in an additional 70 new indirect jobs in the region. BASF will retain 1,100 existing jobs in Geismar and continue to support over 400 contractor jobs.

“This new plant further strengthens our position as a leading supplier of chemistry for sustainable solutions,” said Tom Yura, who also serves as general manager of the Geismar site. “This investment also demonstrates our strong commitment to our employees, our community and our presence in Louisiana.”

Over the past decade, BASF has invested more than $800 million in major projects in Ascension Parish. This MDI expansion project will generate 180 construction jobs at peak activity. The company expects to finish the project by the end of 2020.

“The investment that BASF is making in their Ascension Parish site is further proof that Ascension is a great place to do business,” Ascension Parish President Kenny Matassa said. “In addition to the jobs they provide and the tax revenue they generate, they have given back to the community through support and sponsorships. BASF has always been a great corporate citizen.”

This project has been in the works for some time. To secure the investment, the state offered a competitive incentive package that includes a $1.65 million Modernization Tax Credit. The credit will be claimed din equal installments over a five year period. BASF is also expected to take advantage of the Industrial Tax Exemption and Quality Jobs programs.

“AEDC has been very fortunate to have a great relationship with BASF and we are proud of the economic impact BASF has on our community,” said President and CEO Kate MacArthur of the Ascension Economic Development Corporation. “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.”

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