VACHERIE — The head of a storage tank farm company ordered by the St. James Parish president to stop work on a site in Vacherie said the company’s not walking away from the project.
“We’ve spent in excess of $40 million so far. We’re not about to walk away from $40 million,” Larry Sciacchetano, of Baton Rouge, managing partner and chief executive officer of Petroplex International, said Monday.
In early December, Parish President Timothy Roussel issued a stop-work order on the 1,700-acre site, saying work on the tank farm was not being done in a timely matter and that the company had mostly just moved dirt around.
On Saturday, Roussel issued a statement giving further information about the earlier stop order.
“One of the most important conditions was that Petroplex had to start permanent construction by July 31 and to pursue that construction continuously and diligently. … By late October, it was becoming clear that the initial dirt work was not making progress toward real construction,” Roussel’s statement reads.
Sciacchetano said, however, that dirt work is the first, vital step in the project.
“When you build a tank, you preload dirt on the (tank’s) foundation, 24 feet of dirt on the site, just for the first tank,” he said.
“We’ve never wanted to litigate it. In litigation, no one wins,” Sciacchetano said. “We’re trying to resolve it peaceably, but no one has approached us” with a way to resolve the issue.
Petroplex purchased the land for the tank farm, a 1,790-acre site then zoned industrial, for $19 million in 2011.
After St. James Parish adopted a new land-use plan in 2014 that changed the designation of that land from industrial to residential and agricultural, the parish Planning Commission rejected the Petroplex plans to place the $800 million crude oil storage tank farm there.
However, the Parish Council in May overruled that decision, issuing a land-use waiver to Petroplex after the company agreed to abide to a special resolution that named certain regulations and timelines for the project.
The initial permit for the plant was issued by the state Department of Environmental Quality in 2009.
That permitting decision by DEQ has been upheld by the 19th Judicial District Court and the Louisiana 1st Circuit of Appeal. Opponents to the permit had said the plant would emit compounds that could cause cancer.
On Monday, Roussel noted, “The Parish Council had passed a resolution in May giving them an extension through July 31.”
“They did start moving dirt around” in July, he said, but since then, the company has not meet the resolution requirements.
Among those were specific project plans and a permit for a trailer at the site.
In the written statement, Roussel noted that the Louisiana Licensing Board for Contractors issued a cease-and-desist order this month “alleging that two contractors were performing work illegally without a license.”
Sciacchetano said that on the day the parish president issued the stop-work order, on Dec. 3 or Dec. 4, there had been a meeting scheduled at 1 p.m. between Petroplex staff and parish officials to discuss the project and any concerns about it.
“At 8 a.m., the stop-work order (was issued), and they went to the site and ordered the workers home,” Sciacchetano said.
“The stop-work order caught us by surprise,” he said.
Sciacchetano and parish officials met, anyway, as scheduled at 1 p.m., he said.
“We showed them all our invoices and daily logs. They said all we’re doing is moving dirt around,” he said.
“When the land use was designated industrial forever (back in 2011), we borrowed $20 million with a bank in the state” through a U.S. Department of Agriculture program designed to support economic development in lower-income areas, Sciacchetano said.
The facility, with approximately 30 tanks planned, would bring 500 construction jobs to the parish, Sciacchetano said.
“When they passed the new land-use plan, we had an anchor tenant and an investor bail out,” he said, before the project moved forward again.
“We can’t just walk away. It’s a government-guaranteed loan and investors,” Sciacchetano said.
“Truthfully, it’s beyond belief,” he said. “It’s an $800 million project with 500 construction jobs and yet there’s been no cooperation from the parish.”
The general contractor for the project, Verwater BV, based in Rotterdam, Netherlands, “is one of the best in the world,” Sciacchetano said.