2005-02-14 Regular Meeting and Public Hearing Meeting of the La Porte City Council minutes

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EVAL to stre~~ Pasadena plant as demand for resin multiplies HOl!ston,8usinessJourllill BY JENNIFER DAWSON HOUSTON BUSINESS JOURNAL '1r Week of October 29-November 4, 2004 EVAL Company of America plans to start construction Dec. 1 on a local plant expansion that carries a price tag of$150 million. The Pasadena plant operated by EVAL Company of America, or EVALCA, makes a versatile resin used in a variety of aoolkll.tiom;, For instance, the EV.A..L resi~ 'is used to coat food pa'ckages and keep oxygen out to preserve freshness. Once the new production' line in Pasadena is finished in March 2006, the plant will double its capacity - from 53 million pounds to 104 million pounds of the ethylene vinyl alcohol copolymer resin per year. Nicole Herms, an EVALCA marketing executive, says the decision was made to increase the plant's capacity in order to meet a growing worldwide demand for the resin, which is only produced by one other competitor. "If we didn't do this expansion, it would definitely limit the growth of the (resin):' Herms says. "The market would be con- strained by capacity. not by actual appli- cations. It's growing so aggressively:' EVALCA estimates the demand for its resin is growing by at least 10 percent per year. PLANTING SEEDS Nobuya Tomita, EVALCXs president, says Pasadena was chosen from among the company's three plant sites world- wide for this expansion because Americans are more accepting of new products. "It's muc'h easier in this country to intro- duce a new product," Tomita says. Other reasons for the local'expansion include Tomita a skilled work force and 'tax abatement from Harris County Commissioner's Court. Tomita says the abatement will save EVALCA $91,000 a year for 10 years, beginning in 2006 when the new plant line becomes operational. The tax abatement, which has received tentative approval, is expected to face a fi- nal vote by Harris County Commission- er's Court some time in November. David Turkel, director of Harris Coun- ty's community and economic develop- ment department, says the abatement is expected to be approved, possibly as eady as Nov. 9. "We're not anticipating any prob- lems," Turkel said. "We've reviewed it, and it meets all the county guidelines. This department plans to recommend approval to Commissioner's Court:' Paul Chavez of the Bay Area Houston Economic Partnership, which worked with EVALCA on the project, says EVAL- Cf\s decision to add afourthproduction line will have a positive impact on the lo- cal economy. l'he expa....lsion is 6Apected to add 25 employees to the firm's 94-person em- ployment base, he says. The jobs carry salaries of $55,000 to $94,000 per year, according to Chavez. "Por this industry, 25 jobs is a lot:' he suys. "This is going to create high-pay- ing jobs that are within an industry that's continuing to grow in this region. It's smart growth for the area:' Anotherlocal company will cash in on the project after being selected to handle the construction work. A joint venture between Houston~based S&B Engineers and Constructors and JGC of Japan has been tappedtoconstructthe new line. JAPANESE TIES EVALCA is a wholly owned subsidiary ofKuraray Co., which is based in Osaka, Japan. The firm established a local pres- ence in 1983. EVALCXs parent company opened a new research and development facility next to the Pasadena plant in April ,of this year. That center is shared by EVAL- CA and a sister subsidiary, SEPTON Company of America. The Kuraray Research and Techriical Center USA, which cost $8.5 million to build, employs a dozen EVALCA per- sonnel and a handful ofemplo~~~1 SEPTON and Kuraray. "'.'\": 5h" The R&D center is the company's on- lysuch facility olltslde~ofJapan. Kuraray claims to be the first in the world to develop and commercialize the EVALresin, a process it began in 1972. In addition to food packaging, the resin is used as a barrier t<? fuel vapors in plastic fuel tanks in automobiles. EVAL is also used in floor heating pipe sys- tems, chemical bottles, cosmetics, wall- paper and balloons. Kuraray manufactures EVAL resin in three locations - at the Pasadena plant, in the firm's Okayama plant inJapan and in EVAL Europe N.V. in Belgium, which is also undergoing an expansion. Once the two expansion projects are complete, the company will have a global capacity of 180 million pounds per year. . jdawson@bizjournals.com . 713-960-5935