Exxon Mobil has announced a delay in its plans to construct a large plastics production plant on the Gulf Coast of Texas, initially slated to begin next year in rural Calhoun County. The project was valued at $10 billion.
“Given current market conditions, we are delaying the Coastal Plain Venture development,” Exxon stated. “We are confident in our growth strategy and remain interested in a potential project along the US Gulf Coast and globally.”
Six weeks prior, a district court judge voided a local school board’s agreement to negotiate a tax break with Exxon, following a lawsuit by Diane Wilson, 77, and her group, San Antonio Bay Estuarine Waterkeeper.
On August 19, the judge required the school board to repeat its public hearing on Exxon’s tax break after Wilson claimed the district provided insufficient notice to bypass public opposition. Wilson, a well-known environmental advocate, vowed to ensure a large audience for the rehearing.
“I think it definitely played into it,” Wilson commented on Exxon’s decision. “If there hadn’t been a fight, there would be no delay.”
Exxon, which reported nearly $34 billion in profits in 2024, sought a 50% property tax reduction from the Calhoun County Independent School District for 10 years starting in 2031, when the project would have launched.
The plant was projected to produce 3 million tons of polyethylene pellets annually for export, mainly to Asia, according to Exxon’s December 2024 tax abatement application.
John Titas, president of the Victoria Economic Development Corporation, expressed doubt that Exxon’s decision was linked to the tax break dispute. “It’s economics. For such an investment, the market must promise returns,” he explained.
Exxon’s latest statement, reported by the Independent Commodity Intelligence Services, highlighted the potential of resuming the project. “We maintain positive relationships with community leaders and contractors, ready to reassess the project when market conditions improve,” they stated.
Exxon did not specify which market conditions need alteration, though growth in plastics demand is anticipated. Precedence Research estimates the polyethylene market will grow 64% from 2024 to 2034, while Expert Market Research predicts a 51% increase in overall plastics markets. The Plastics Industry Association reports strong demand backing global plastics growth.
Wilson considers the project’s delay the best news since her 2019 lawsuit against Formosa Plastics resulted in a settlement exceeding $100 million in penalties and facility upgrades. A retired shrimper and activist, Wilson received the 2023 Goldman Environmental Prize for her environmental efforts. Upon learning of Exxon’s project in December 2024, Wilson swiftly engaged in public processes she was familiar with, including school district tax negotiations.
“Community reaction is crucial,” she stressed. “Act fast and don’t relent.”
Original Story at insideclimatenews.org