Refinery funding delayed, but Rusk County project said to be on track
By by Peggy Jones email@example.com
Nov. 21, 2012 at 10 p.m.
Plans for a $181 million refinery in Rusk County remain on track - though slightly behind schedule - after the company involved requested an extension on the timeline to secure funding, a spokesman for Gregg County Refining said Wednesday.
The company received approval for issuing $181 million in tax-exempt bonds this summer, with Nov. 15 set as a deadline to secure financing by selling those bonds.
Rob Latsha, spokesman for the bond review board, which administers the tax-exempt bond program, said Gregg County Refining filed for an extension Nov. 15 on the deadline for funding.
Latsha said several companies, including ExxonMobil, also have applied for the tax-free bonds should Gregg County Refining not be able to secure financing.
But John Kennon, vice president of business development for Community Education and Development - the consulting firm handling the finance portion of the refinery project - said Wednesday that the request for an extension was granted by the governor's office and the project will come to fruition.
"It is complex," Kennon said. "There are so many little details. Snags are expected in a project like this. We anticipated we would need a little more time. We asked for it and received it."
He said one reason for the complexity of getting the project off the ground lies in its rarity.
The refinery, planned on 165 acres on Texas 323 near New London, will be the first of its size built in the United States in more than 30 years, Kennon said. It will refine light sweet crude oil into gasoline and diesel.
The refinery will have a capacity to produce 30,000 barrels of fuel a day. The nearest-sized oil refinery built in the U.S. was brought on line in Valdez, Alaska, in 1993. That facility had a capacity to produce 26,300 barrels a day.
When announced earlier this year, officials for Gregg County Refining said they expected the construction project would be carried out during a period of two years, creating about 400 construction jobs. The company anticipated hiring about 95 full-time, permanent workers once the refinery is operational.
The project entails dismantling the old Longview Refinery on Premiere Road in Longview and refurbishing and relocating much of that equipment for re-use at the new refinery. Longview Refinery started operations in 1935 but went the way of many other refineries, closing its operations in 1992.
Rusk County Judge Joel Hale said he was notified of the delay in funding Friday, describing the news as disappointing.
"I don't know of a reason to be concerned, though," Hale said. "They assured me things are still on go. We are still very hopeful this will happen."