New plant to impact timber industry most

Published 12:05 am Sunday, September 4, 2011

NATCHEZ — A new plant that turns pine into sugars that can be used to make fuel and other products, should open in Natchez by 2015.

And while today might be too soon to fill out an application for more than 200 jobs up for grabs at HCL Cleantech’s Natchez Plant, state lawmakers and Natchez Inc. Executive Director Chandler Russ said the number of jobs — both directly and indirectly from the timber industry — will be very much worth the wait.

HCL CleanTech says the average salary among the five cities it plans to locate will be $67,000, plus benefits, and the company says it will invest $1 billion in the state.

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The Mississippi state legislature approved a bond bill during a special session Friday that included a $100 million loan for HCL CleanTech Inc., which wants to build its headquarters and four plants to turn wood chips into cellulosic sugars that can be used in fuel, pet foods, cosmetics, lubricants and other products.

Mississippi Development Authority officials said the headquarters office in Olive Branch and a pilot processing plant in Grenada could open in 2012.

Russ said Natchez is slated to be the location for the first large-scale plant, which MDA officials said could open in 2015.

“Ours is the (site) third in line,” Russ said.

Construction of two other large plants should open in Booneville and Hattiesburg in 2017 and 2019, respectively.

Russ said it could be two or more years before skeptics get to see dirt moving on the ground, but he has no doubt landing the company for the area will greatly impact the entire Southwest Mississippi region.

Sen. Bob Dearing, D-Natchez, said more than 200 construction jobs will be required to build the plant in a couple of years.

And with an abundance of pine supply in the area coupled with the lack of a big demand within 80 miles of Natchez, the new company could beef up a locally struggling timber industry.

“The job market in southwest Mississippi is getting a great shot in the arm,” Dearing said.

When the Natchez HCL Cleantech plant opens, Russ said, it will use 1 million tons of pine or softwood.

To put the figure into perspective, Russ said International Paper’s Natchez plant was using 1.2 million tons of wood a year at its peak before it closed.

Billy Ulmer, a local owner of timber companies Monticello Tie and Timber and Woodhaven Cooperation, said the impact would be huge not only on Adams County’s timber industry, but companies in surrounding counties and in Concordia Parish.

“That’s very substantial — 1 million tons of wood (a year),” Ulmer said.

One truckload of wood equals 27 tons, and 1 million tons equals 37,000 truckloads, he said.

And since timber industries usually work 200 days a year, Ulmer said, hauling HCL Cleantech’s projected demand would mean 185 truckloads would be hauled a day.

“In terms of fuel, tires and all the supplies that goes along with it — not to mention the amount of people you would employ — (the company would be) creating that much of (an impact) in a small area,” Ulmer said.

Supplying a local company would help local timber companies avoid shipping their product an average of 80 to 90 miles, saving the cost of fuel and equipment, Ulmer said.

He said some local companies have been forced to close in recent years because their profits cannot match the cost of transporting the wood.

Ulmer said the local timber business has struggled since IP closed, and has dropped off even more since the local housing market took a dip in approximately 2006.

Good timber business also brings perks to the county, Ulmer said.

The state and county would collect more diesel taxes, sales tax on timber, tires and “all the stuff that goes along with the logging business,” Ulmer said.

Ulmer also said the local supply of pine could handle the demand.

“We have a vast resources of timber,” Ulmer said.

Ulmer said in every study he has seen about the local supply of timber, the harvest never comes close to wiping out forested areas.

He said the supply of timber was constantly replenishing itself when IP was in town.

“We have never cut our growth,” Ulmer said.

Sen. Kelvin Butler, D-Magnolia, said the area’s abundance of timber helped land the new company.

“We’re just excited that they picked our area because they’ll be using pine, and that’s one of the resources we have right here in southwest Mississippi,” Butler said.

He said he was pleased HCL Cleantech and other companies have recently shown interest in the resources and that the area’s timber resources will no longer be taken for granted.

Butler said the fact that HCL Cleantech is an existing business that wants to move operations to the area from two other states — North Carolina and Ohio — bodes well for southwest Mississippi and the state.

Rep. Robert Johnson, D-Natchez, agreed that HCL Cleantech’s desire to locate in Mississippi is impressive considering the company’s standing.

“What I find sort of amazing is that with (HCL) Cleantech talking about $67,000 (salaries) a year, it’s the kind of job where the company’s on the cutting edge of new technology,” Johnson said.

Johnson said the company has received more than $10 million in federal grants, some coming from the U.S. Department of Energy.

“The federal government believes in these industries and investors believe in them, so we’re fortunate,” Johnson said.

Rep. Sam Mims, R-McComb, said people will drive 60 to 70 miles for good-paying jobs, and the opportunity in Natchez is good for the entire region.

“(Friday) was a good day for Mississippi, and a good day for southwest Mississippi, especially, during this time in (a struggling) economy,” Mims said.

“I can assure you that many other states wished … (to have) passed legislation to help get people back to work,” he said.