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Origin Materials to Build $750 Million Sustainable Materials Facility in Louisiana

Carbon-negative materials maker Origins Materials has its sights set on setting up shop in bayou country.

The company and Louisiana Gov. John Bel Edwards jointly announced Wednesday that the newly public enterprise settled on a site in Geismar, La. where it plans to build its first world-scale manufacturing facility, dubbed Origin 2. The deal hinges on hammering out economic incentives.

The facility would produce carbon-negative materials used to make polyethylene terephthalate (PET) plastic, which is used in packaging, textiles, apparel and other applications, as well as hydrothermal carbon that can be used in fuel pellets, as activated carbon, and as a replacement for carbon black. Origin’s patented technology platform can turn the carbon found in sustainable wood residues into useful materials while capturing carbon in the process.

The 150-acre facility would create an estimated 500 construction jobs, 200 local full-time positions and between 500 and 1,000 indirect local jobs, the company said. The plant would convert an estimated 1 million dry metric tons of wood residues each year into products for a wide range of end markets. The company expects construction to begin in mid-2023 and for the plant to be mechanically completed and operational by mid-2025.

The pending state and local incentives are estimated to be worth more than $100 million. In addition, a private activity bond volume cap allocation from the State of Louisiana, pending finalization, is expected in the amount of at least $400 million. Private activity bonds are tax-exempt bonds authorized by state and local governments for the financing of qualified projects with private capital.

“Origin is excited to announce this investment in sustainable manufacturing with the governor of Louisiana,” said John Bissell, co-CEO of Origin. “The local talent is world-class across refining, forestry and agronomy, feedstock logistics and chemicals. The site sits along the Mississippi River with easy access to barge and rail and plentiful local wood residue feedstock. The proposed incentive package for building in the area is compelling and the local industrial cluster can provide access to hydrogen, ethylene, water treatment and more.”

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Edwards said Origin’s process of developing PET products from renewable wood fibers is an example of how the global shift toward sustainability can catalyze economic investment and job creation in the state.

“The company’s carbon-negative mission aligns with our Climate Action Plan’s approach to limiting the severity of climate change while maintaining economic competitiveness in a low-carbon future,” he added.

Bissell noted strong demand for “‘net zero”-enabling materials, and “believe[s] this plant will be instrumental in addressing demand for our products in the United States and internationally.”

The company is also building Origin 1, a smaller plant in Ontario, Canada. Headquartered in West Sacramento, Calif., Origin Materials has developed a platform for turning the carbon found in inexpensive, plentiful, non-food biomass such as sustainable wood residues into useful materials, while capturing carbon in the process. In addition, Origin’s technology platform is expected to provide stable pricing largely decoupled from the petroleum supply chain, which is exposed to more volatility than supply chains based on sustainable wood residues.

Louisiana Economic Development is responsible for strengthening the state’s business environment and creating a more vibrant Louisiana economy. In 2021, LED attracted 64 new economic development projects representing over 18,100 new direct and indirect jobs, 9,700 retained jobs and more than $20.6 billion in new capital investment.

To secure the project, the state is offering Origin Materials a competitive incentive package that includes the services of LED FastStart, a statewide workforce development program. Additionally, the company would be eligible for a $6 million performance-based award to be paid out over six years, to reimburse site infrastructure costs. The company is also expected to utilize the state’s Quality Jobs and Industrial Tax Exemption programs.