Plans for $ 2 billion Washington methanol plant ‘come to an end’ as company terminates lease


Plans for a more than $ 2 billion methanol plant in southwest Washington are “effectively completed,” according to a statement released Friday by officials at the Port of Kalama because Northwest Innovation Works – which denied a permit by the state this year – will end its site lease.

The project, planned for years, suffered a big setback in January when the State Department of Ecology rejected an application for a coastal permit required to build the plant, which was said to have been one of the largest users of Pacific Northwest natural gas.

Northwest Innovation officials, in a statement Friday, said that following the permit denial, “Washington’s regulatory environment has become hazy and unpredictable.”

The statement says the company is evaluating “an appropriate way forward” and is developing other projects, including one to produce hydrogen. The statement did not include information on possible sites for new projects.

The methanol project was first proposed in 2014 and has sparked intense controversy with strong support from many in Southwest Washington for the jobs it would create and strong opposition from environmental groups who cited carbon emissions from natural gas that would be used at the plant.

Early on, the developers said the project would help reduce global greenhouse gases by replacing the coal-based methanol that is created in China in a process that produces significantly more carbon emissions per gallon of product. .

The developers said methanol will be widely used as a raw material in China’s plastics industry.

In 2015, the project appeared to have the backing of Governor Jay Inslee, who called the proposed methanol plant “one of the most innovative clean energy projects in the country.” “

A state study released in December found that the project would have a “high probability” of helping to slow the increase in greenhouse gases around the world.

But in interviews last year, state officials questioned those findings, saying they were based on an analysis of difficult-to-predict future markets. And Laura Watson, director of the state’s ecology department, cited the plant’s greenhouse gas emissions as the reason for rejecting the permit.

“I want to be very clear that a project that would increase greenhouse gas emissions by almost 5 million tonnes (metric) per year would not benefit the environment …” Watson said during the announcement of the state’s decision. “At most, this project would be less damaging than potential alternatives. “

Kalama port officials reacted bitterly on Friday to the cancellation of the lease for a project that would have created 1,400 construction jobs and 200 permanent jobs. They also took a hit on Inslee, who made climate change a central issue in his failed 2020 presidential bid.

In May 2019, Inslee withdrew his support for the methanol project, saying he was no longer convinced it would accomplish what was needed to reduce greenhouse gas emissions.

His announcement of the change came the day he signed a bill banning the use of hydraulic fracturing to produce natural gas or oil in Washington state. Inslee said at the time that his opposition was not intended to influence the regulatory review of the project.

The change in Inslee embittered those responsible for the port of Kalama.

“It was the kind of innovative, job-creating project that was originally supported by the governor’s office. Jay Inslee stood on the Kalama waterfront to tout the climate benefits of the project and then turned on us when he ran for president, ”said port manager Mark Wilson.

“Unfortunately, this is part of a larger pattern of reluctance to listen to divergent opinions and find balanced and sensible solutions,” said Randy Sweet, chairman of the Kalama Port Commission.

Inslee spokesperson Mike Faulk said on Friday that it was not the policy that changed the governor’s stance on the methanol project, and that in 2019 he provided substantial reasons for taking a new position.

Also on Friday, Columbia Riverkeeper executive director Brett VandenHeuvel said he was inspired by activists across the state, including in Kalama, who spoke out against the project.

“It’s been a long fight, and I think we made the leap in Washington. After many years of fracking coal, oil and gas infrastructure proposals, we look forward to a clean energy future in Washington, ”said VandenHeuvel.

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