In a sign of confidence in downtown Baton Rouge and Louisiana’s petroleum sector, Dallas-based Placid Refining Company announced Thursday it will move its headquarters to Fourth Street as part of a $66 million project that will include upgrades to its Port Allen refinery.
The company expects the relocation and modernization project to create 20 new jobs and 88 indirect jobs, and it will also retain all 215 employees at the Port Allen facility.
Placid Refining bought an office building and parking lot in downtown Baton Rouge in January for nearly $4.8 million. The 19,376-square-foot building, located at 402 N. Fourth St., is the former office of the Baton Rouge Area Foundation and Level Homes.
Placid Refining spokesman Tyler Gray said the company will move up to 50 of its employees into the downtown Baton Rouge building. Though he declined to reveal how many of those employees were moving from Dallas compared to Port Allen, he said the "entire leadership team" is moving from Texas to Baton Rouge. He added that the company has seen a “transition” in recent years of employees shifting to Louisiana.
Gray also declined to divulge the average annual salary for the new jobs, but he said they will be “good-paying jobs” with “professional salaries.”
Placid Refining is already working on renovations to the Fourth Street building. Gray said the company hopes to move employees there by the end of the year. The refinery upgrades, meanwhile, should take about three to five years.
Placid Refining’s Port Allen facility refines up to 82,000 barrels of crude oil per day and has been in operation since 1975. Company officials said the $66 million investment will include equipment upgrades to help the company deliver more of its products to more customers.
“This announcement is about growing our operations and centralizing in Louisiana,” Placid President Rob Beadle said in a statement. “Placid has a long history in the state with operations centralized in Port Allen and employing generations of families, sometimes more than one member of a household. This investment is about transitioning our headquarters from Texas so we can better support our operations here at home.”
To draw the $66 million investment here, Louisiana offered Placid Refining an incentive package that includes a performance-based retention and modernization tax credit of up to $500,000. Louisiana Economic Development officials said Placid Refining is also expected to participate in the state's Industrial Tax Exemption and Enterprise Zone programs.
The move is a shot in the arm for downtown Baton Rouge, which Downtown Development District Executive Director Whitney Hoffman Sayal said is “still somewhat recovering” from work-from-home changes induced by the COVID-19 pandemic.
“To have a corporate headquarters move here speaks to the fact that downtown is still the center of commerce,” Sayal said.
Roughly 30,000 people were working downtown in 2019, Sayal said, mostly in government jobs. DDD is still working on getting updated, post-COVID totals, but she said occupancy for Class A and B space downtown has been relatively stable despite a "slight decline."
Sayal said DDD officials spoke to Placid Refining about the amenities downtown, including a grocery store, restaurants, a pharmacy and plenty of walkability.
“I think they see what the majority of people do see and the value of the city center,” she said.
The United States refining industry was hit particularly hard by the pandemic, said Greg Upton, interim executive director of LSU’s Center for Energy Studies. Two refineries shut down in Louisiana in recent years: Shell’s Convent facility, and Phillips 66’s refinery in Plaquemines Parish.
“This past year, what we’ve seen is those margins for refineries have really improved,” Upton said, noting that higher gasoline prices helped offset higher costs for crude oil in 2022. “This (move) is a good signal that companies are wanting to make these kinds of long-term investments in the Louisiana refining sector.”
Anna Johnson, executive director of the West Baton Rouge Parish Chamber of Commerce, said the parish is "delighted" to have a "world-class partner" like Placid Refining move its headquarters to Louisiana and transform its Port Allen complex.
“With the team’s expertise and Placid’s network and success, they are poised to build upon an already incredibly strong team and platform that is nearly 50 years in the making," Johnson said in a statement. "Their economic vitality will further improve the refinery’s competitive position and continue to secure future growth.”