GONZALES — BASF personnel are commissioning the startup of a new surfactants plant this month, one of several phases in a $350 million expansion at the German chemical giant’s 2,600-acre complex in Ascension Parish.
But the imminent startup is a year behind schedule for the plant that promises 45 permanent jobs to make chemicals used in detergents, cleaners, cosmetics, as well as aid in the production of leather, paper, textiles and other products.
Company officials had said they hoped to have the operation, known under the code name “Solitaire,” up and running in late 2013 when the project was announced in 2011.
Another phase of the 98-job, $350 million expansion, a formic acid plant for which construction started in October 2012, is also about a year behind schedule and is not expected to be finished until mid-2015.
“There were significant delays on both the surfactants and formic acid plants,” Jolen Stein, BASF’s spokeswoman in Geismar, said Wednesday.
But the delays are happening for different reasons, she said.
The formic acid plant has been delayed by the competition for labor as billions of dollars worth of other expansions are planned or underway in south Louisiana’s River Parishes region. Stein said labor demand and the availability of construction workers have both been factors and noted that other companies’ expansions in the area have run into labor difficulties as well.
As for the surfactants plant, a lawsuit that BASF recently filed in Ascension Parish alleges CB&I, the project’s primary contractor, is a major source of that delay.
BASF’s 12-page lawsuit against CB&I details a year’s worth of back and forth between the companies over delays on the project, BASF’s attempts to find out the cause from CB&I and CB&I’s alleged unwillingness to submit records that could shed light on the issue.
Stein declined comment on the suit Wednesday. Matthew Braud, a spokesman for CB&I, did not return two emails for comment this week.
Separately, BASF officials in New Jersey said Nov. 15 they were delaying the planned closure of their Washington, New Jersey, surfactants plant while they await the completion and the transfer of production to the new Geismar plant, according to lehighvalleylive.com, website of the Easton, Pennsylvania-based The Express-Times newspaper.
The announcement came four days before BASF filed suit against CB&I in Louisiana on Nov. 19.
BASF officials had previously announced the New Jersey operation would close in late 2014 with the startup of the Geismar facility but are now saying closure is not expected until mid-2015, lehighvalleylive.com reported.
A 22-job polyurethane blending unit that is also part of the $350 million expansion in Geismar is essentially on schedule and is set to be finished in mid-2015, Stein said.
State Economic Development Secretary Stephen Moret said Wednesday the delays won’t affect BASF’s ability to collect on statutory incentives like Quality Jobs, which don’t have time limits but require the company to deliver on promised benefits first.
According to BASF’s lawsuit, CB&I claims BASF was at fault for the surfactants plant delays due to tardy delivery of structural steel, pipe, valves and equipment and is seeking reimbursement from BASF.
But BASF says CB&I’s claims have “serious flaws and inconsistencies” and that CB&I understaffed the project. BASF wants a judge to enforce its nearly $29 million contract with CB&I for access to records that could show the veracity of CB&I’s claims.
Stein’s statement this week that the surfactants plant is being commissioned for startup contrasts with descriptions of the project’s progress when BASF’s suit was filed less than a month ago.
The suit claimed then that “the project remains incomplete” and “that CB&I is falling further behind in completion of the work.”
The suit also asks a judge in the 23rd Judicial District to rule, if CB&I’s records show BASF is right about the source of the delays, that BASF is not at fault and does not owe CB&I money.
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