In Louisiana’s economy, it’s about oil and gas. That may seem obvious, but the phrase typically conjures up mental images of oil rigs, the exploration and production segment of the industry. A huge component of the energy industry in the state is what the experts call downstream.
Those are big employment centers along the Mississippi River between Baton Rouge and New Orleans, and in the Lake Charles area on the Calcasieu River: refineries and petrochemical manufacturing complexes.
In the case of Baton Rouge’s ExxonMobil — formerly Standard Oil — the mutually beneficial relationship with oil refining goes back more than a century.
In every case, though, there has always been controversy over industrial development, also dating back a long time, to Huey P. Long’s famed battles with Standard Oil in the 1930s. More recently, Louisiana struggled with decades of government’s failure to protect air, water and land from emissions from plants as well as drilling sites.
History ought to be updated. We know better now how to make industrial development work more safely.
One of the new fights over petrochemical development is in St. James Parish over a $9.4 billion plastics complex, now under environmental review.
This is a huge economic development win for the parish and for the state. Formosa promises more than 1,000 high-paying jobs in a state and a region that desperately needs them.
Another 8,000 temporary construction jobs would come to the area. Building such a large facility will take years. And Formosa is one of the big projects that business leaders expect will take up some of the employment slack in industrial construction.
The plant's construction is estimated to generate $500 million in direct sales in the region and $362 million in state and local taxes, with about $200 million for the St. James area parishes.
These are huge numbers, and that is a reason why leaders in the parish and the state are enthusiastic about the prospect of another big plant in the region.
However, such a big facility is inevitably a flashpoint for criticism, as industrial development on the river is concentrated. At one of the many public hearings on Formosa, some residents and environmental activists criticized the proposal.
The industry can point to significant reductions in emissions over the last few decades, but there is no question that those will increase, in a region where much of the wealth comes from petrochemical manufacturing.
But the extensive reviews and public hearings also point to Louisiana’s better understanding of how to regulate industrial facilities. It’s vital that the activists hold the Department of Environmental Quality and other agencies, as well as the company, to the highest standard of scrutiny.