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Port to make $100 million in improvements ahead of Leucadia agreement

Last Modified: Monday, October 29, 2012 8:16 PM

By Lance Traweek / American Press

The Port of Lake Charles will make $100 million worth of improvements to its Bulk Terminal No. 1 in preparation for its 25-year operating agreement with the Leucadia Energy gasification plant project, according to port staff.

The port has partnered with Lake Charles Clean Energy, a subsidiary of Leucadia, which will use new gasification technologies to cleanly produce industrial liquid and gas products from petroleum coke. The products — methanol, sulfuric acid, argon, carbon dioxide and hydrogen — will be sold by the company to BP, Air Products and Chemicals Inc. and Denbury Onshore LLC.

The project, estimated at $2.5 billion, will be located on port property and adjacent to the port’s bulk cargo handling facility. The partnership will result in 1,500 construction jobs over a period of three years, and once finished, the plant will create 165 high-paying permanent jobs. Also, the operation of the plant will bring 50 new full-time jobs to the port, positions needed for the additional loading and unloading of related cargo. Construction will begin by mid-2013.

The port’s role will also include loading trucks, railcars, barges and ships with the company’s liquid products for transportation to customers. Port Executive Director Bill Rase said the impact on the port will be substantial: it will double the cargo tonnage handled at the terminal to an estimated 6 million tons each year and will require cargo handling 24/7.

The actual transformation of the bulk terminal will start instantly with the relocation of port customers so as not to negatively impact customer cargo. After that, the petcoke storage area will be reconfigured. An extra 1,000-foot concrete discharge dock with conveyors will be built to transport inbound coke to the storage area. Another 1,000-foot liquid dock will be built to handle the loading of liquid products to a newly constructed tank farm, and later to vessels and barges. This infrastructure will allow the port to handle the additional import tonnage of 2.6 million tons of petroleum coke and the export of 1.25 million tons of liquid products per year, according to news release.

“We’re very excited about this. It is something we have worked on for a number of years,” Rase said. “The ability of the group to finally get the off-take agreements with major corporations will allow it to be financed and move forward. We feel comfortable this will be a successful project for the port, for clean energy, and for the community.”

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