05/22/2012 03:16 pm ET Updated Jul 22, 2012

Corexit Maker Nalco Gets Louisiana Credits For Plant

This article was published in The Louisiana Weekly in the May 21, 2012 edition.

Nalco Company, the maker of Corexit used to disperse oil from the BP spill, is using Louisiana state credits to build an $18.7 million polymer facility at its Garyville plant -- 35 miles upriver from New Orleans. Critics of that early May announcement wonder why the state continues to subsidize petrochemical plants and why Illinois-based Nalco is being given incentives when cleanup workers in Louisiana are suffering from Corexit sprayed in mid-2010 and later.

The dry-polymer unit will be part of Nalco's 42-year-old complex, making water-treatment chemicals, in St. John the Baptist Parish. The parish's biggest industry is its ten petrochemical plants and oil refineries. Nalco, a unit of Minnesota-based Ecolab, expects to add 22 jobs to its Garyville staff of 235 and to create the equivalent of 167 temporary construction jobs. Louisiana Economic Development officials said as an incentive, Nalco will use the state's Industrial Tax Exemption and Quality Jobs incentive programs.

Ground was broken last fall and the unit should be finished late this year. Nalco is awarding all ten of the project's construction contracts to Louisiana companies but that doesn't mean the workers they hire will necessarily be state residents. The new 300,000-square-foot facility will expand the complex, which is already Nalco's biggest plant, to one million square feet.

Customers for Nalco's dry polymers are expected to include plants along the river owned by other companies who need the products for water treatment.

Last week, Louisiana Economic Development Secretary Stephen Moret said "the state's Industrial Tax Exemption and Quality Jobs programs provide incentives that are available to any company meeting the eligibility criteria." Under the tax exemption program, no property taxes have to be paid on improvements -- new facilities and equipment -- for 10 years. And the quality jobs program gives Nalco an annual, 5-to-6-percent rebate on eligible, new payroll for 10 years.

"The actual value of these incentives for Nalco will depend on their final capital investment and payroll numbers," Moret said.

What's wrong with the state helping Nalco? A lot, said Daniel Becnel, Jr., a long-time resident of St. John the Baptist Parish and an attorney representing BP spill victims. For starters, petrochemical plants don't need subsidies and credits to locate in Southeast Louisiana. "They want to be here because of navigation and infrastructure and since few other states or communities will let them in," he said.

From his office in Reserve, La., Becnel said "we've got the river, entry to the Gulf, a full rail network, along with cheap natural gas, land and labor, and very little cold weather. Our pollution laws aren't strictly enforced."

Becnel continued "this used to be plantation country but agriculture is disappearing and the land here sells very cheaply." Antebellum mansions coexist with plants along the river. "The river suits these plants because they need water for steam and cooling," he said. Marathon Petroleum Co. is seeking a state permit now to expand crude oil output at its Garyville refinery.

Many states shun petrochemical plants -- especially near urban areas -- because they release toxic chemicals into the air, and can catch fire and pollute water. "New York, Massachusetts, Minnesota, California and most states don't want these plants," Becnel said.

Meanwhile, droves of people were exposed to BP's oil and Nalco's Corexit in 2010, based on an estimated 90,000 cleanup workers and 105,000 Gulf Coast residents eligible to participate in the medical portion of the likely, $8.7 billion settlement against BP. Settlement documents have been fied in U.S. District Court in New Orleans.

In early April, Daniel Becnel objected to a motion by plaintiff attorneys in the BP settlement to dismiss Nalco from that litigation.

Becnel, who has already settled claims against BP for thousands of fishermen, seafood companies and property owners, also represents 3,500 cleanup workers. He filed a class action suit on April 17, seeking damages from BP and Nalco for cleanup workers who suffer medical problems. The case is Jarod Elrod et al. v. BP Exploration & Production Inc. et al, and Becnel intends to try it in court.

After local cleanup workers suffered from exposure to dispersants, should Corexit's maker be subsidized by the state? Coastal advocate Sherri Foytlin, the wife of an oil worker and mother of six, said "Nalco has shown no social responsibility to cleanup workers. It took a lawsuit from Earthjustice to find out what was in the Corexit sprayed on the water, the coast and on us." She lives in Rayne, an oil workers' town in Acadia Parish.

A year after environmental law firm Earthjustice sued the U.S. Environmental Protection Agency in mid-2010, the feds released the components of Corexit 9500 and Corexit 9527--produced by Nalco and used in the BP spill. Dispersants, which break oil into droplets and move them from the sea surface and into the water column, also contain chemicals linked to cancer and other illnesses, Foytlin noted. Cleanup workers, coastal residents and marine life were all hurt by Corexit, she said.

But Foytlin said "there's a big ravine, a big gap in understanding among the leaders in Baton Rouge about the threats that south Louisiana residents face from chemicals and from petrochemical plants. State Senator Crowe has tried to raise awareness about the dangers of Corexit in the Louisiana legislature but the lobbyists are in charge and they win the day." In May of last year, a Louisiana Senate committee approved Slidell legislator A.G. Crowe's proposal to ban dispersants to fight spills in Louisiana waters -- which extend three miles into the Gulf. Little has happened with the bill, however, and Foytlin predicts "oil companies will continue to use dispersants in spills here."

BP used 1.9 million gallons of Corexit to remove at least some of the estimated 4.9 million barrels of crude the gushed from its Macondo well in 2010. The capped well is 52 miles southeast of Venice, La.

The amount of Corexit spraying and its underwater use in BP's spill were unprecedented. And that's even though years before the spill, in 2001, the EPA and Swedish scientists had evidence that Corexit mixed with oil was much more toxic to aquatic life than oil itself. The UK, where BP is headquartered, banned Corexit in 1998.

In June 2010, with the BP spill in progresss, Louisiana oystermen sued Nalco and BP -- accusing them of permanently altering the seabed and food chain.

The spill is the latest chapter in Louisiana's dependence on industries that threaten human health, critics say. "Many of us here in St. John the Baptist Parish are ill because of all these plants and refineries," Becnel said. "But I stay because I've always lived here."

As for Nalco's Garyville plant, it seems to have cleaned up its act after violations nine and ten years ago. In March 2007, Nalco paid the Louisiana Dept. of Environmental Quality $50,000 in a settlement over improper storage in 2002 and 2003 of materials, including hazardous waste, and over an illegal wastewater discharge in 2003, according to Tim Beckstrom, DEQ spokesman. "No major concerns have been noted at the facility since," he said last week.

In a misstep blamed on the nation's weak economy in 2009, Nalco's Garyville plant was stuck with surplus, finished products with expired shelf lives, and sent them to landfill, Ecolab spokesman Roman Blahoski said last week. The DEQ said Nalco had to send acrylic polymer to a class I landfill in Sorrento, La. from 2008 to 2009.

More recently, the Garyville plant's record includes safety and pollution-prevention awards from the Louisiana Chemical Association and the DEQ.

Nonetheless, many south Louisiana residents want to see fresh thinking about industry from lawmakers. "Other Southern states give tax credits and subsidies but they attract big factories that, for instance, make cars and employ thousands of workers," Becnel said. Hyundai in 2005 opened an Alabama plant that has 2,000 employees and is hiring 900 more now. Toyota opened a Blue Spring, Miss. plant last year, creating 1,500 jobs.

A drive through Louisiana's River Parishes to view plantations and trace ancestors can be jarring because of the many plants and refineries plunked down in that country setting. Petro-chemical facilities exist near Louisiana's beaches, too.

Foytlin said "the state should try to attract clean, sustainable industries, and could outfit hundreds of old oil rigs in the Gulf with wind turbines, or could use turbines to create energy from river currents. But instead we're living in cancer clusters. I attribute it to an extreme lack of vision among the leaders in Baton Rouge."

If you're wondering where Corexit is made, Nalco said last week it isn't manufactured in Garyville and wouldn't reveal where it is produced.