Court voids permits for Formosa’s petchem project in Louisiana

HOUSTON (ICIS)–A state court voided the air permits that the Formosa Plastics Group needs to build a massive petrochemical complex in the state.

The Formosa subsidiary developing the project, FG LA LLC, did not immediately respond to a request for comment on Thursday. 
The complex, known as the Sunshine Project, was planned to be built in two phases for $9.4bn.

The first phase would include a 1.2m tonne/year ethane cracker, a 400,000 tonne/year linear low density polyethylene (LLDPE) unit, a 400,000 tonnes/year high density PE (HDPE) unit, an 800,000 tonne/year ethylene glycol (EG) plant, a 600,000 tonne/year propane dehydrogenation (PDH) unit and a 600,000 tonne/year polypropylene (PP) plant.

The second phase of the project would include a 1.2m tonnes/year ethane cracker, a 400,000 tonne/year HDPE plant, a 400,000 tonne/year LLDPE plant and an 800,000 tonne/year EG plant.

The court was requested to review the state’s decision to issue the permits by Rise St James, the Louisiana Bucket Brigade, the Sierra Club, the Center for Biological Diversity, Healthy Gulf, Earthworks and No Waste Louisiana.

The court broadly ruled in favour of the group, finding that the regulator did not comply with the permitting rules under the state’s prevention and significant deterioration (PSD) regulations.

Because Formosa’s plant would be handling ethylene oxide (EO), the regulator had to demonstrate that people living nearby would not be exposed to concentrations of the chemical that could pose a cancer risk. The Louisiana Department of Environmental Quality (LDEQ) failed to do this.

The court found instances of the regulator making arbitrary and capricious decisions.

The regulator also failed to adequately consider concerns about environmental justice. Environmental justice attempts to account for poor and marginalised people who have suffered from mining, pollution, manufacturing and other activities that threaten their health.

“The LDEQ must take special care to consider the impact of climate-driven disasters fuelled by greenhouse gases on environmental justice communities, and their ability to recover,” the court said.

In addition, the regulator failed to demonstrate that Formosa lacked any alternative sites where it could build the complex.

The case was heard in the 19th Judicial District Court, parish of East Baton Rouge in Louisiana state court. The docket number is 694,029 section 27.