Construction of a proposed $6.5-$7 billion natural gas processing and production facility could begin by the end of the year, a project that will create at least 3,500 construction jobs and then 350 permanent jobs in Ector County, a Houston-based gas manufacturing company announced Wednesday.
The Odessa Development Corporation negotiated the agreement with Nacero, Inc., which plans to build the plant in Penwell.
“This is the biggest deal in Odessa since El Paso Products was built on the south side in 1956.” Odessa City Councilman Steve Thompson said. “This is a great opportunity for the community.”
The company plans to use a more environmentally-friendly process to convert natural gas to methanol, and methanol to gasoline, Nacero officials explained to city council earlier this month during a work session.
This is a unique large-scale energy project that produces zero-sulfur gasoline from natural gas using an environmentally superior process with a smaller carbon footprint compared to traditional gasoline production processes, they said during the presentation.
“Ector County is the ideal location for us,” Nacero President and CEO Jay McKenna said in a news release Wednesday. “From a geographic and logistics standpoint you can’t beat it.
“We will be in a major new market and beneficial home for the natural gas that is currently flared in the Permian Basin. Our zero-sulfur gasoline will reduce ground level ozone in cities across Texas and the Southwest, which is causing illness and limiting economic growth.”
Nacero’s new manufacturing plant will be built in two phases, the news release detailed. Phase one will produce 70,000 barrels per day of gasoline component, which will be ready for blending.
Phase two will increase that capacity to 100,000 barrels per day.
Construction of the Penwell facility will employ a peak of 3,500 skilled workers during the four years of phase one construction.
When fully operational, the plant will employ 350 fulltime operators and maintenance personnel in three shifts with a forecast annual salary of about $85,000 per person.
Nacero has also pledged that its contractors will try to utilize local businesses during construction and operations.
During construction, Nacero officials estimate that $263 million of combined equipment and services will be locally sourceable.
The ODC recently offered a $20 million grant incentive to entice Nacero to come to Ector County, Wesley Burnett, director of economic development for the Odessa Chamber of Commerce, said.
Those funds will be paid out over 10 years if the company maintains compliance with all terms and conditions included in the negotiated contract.
“We have been working on this since COVID started in March 2020,” Burnett said. “There has been a lot of work by staff and volunteers who helped make this happen.
“Grow Odessa and the Odessa Chamber of Commerce were also very instrumental in this effort.”
As an additional incentive Ector County, the Hospital District, Odessa College and Ector County Independent School District have agreed to limit property values, which will provide Nacero a tax break, Burnett said.
State Rep. Brooks Landgraf said he is thrilled to welcome Nacero to West Texas.
“This world-class, innovative company will use 100% American resources to make 100% American affordable gasoline for everyday American drivers. Nacero will diversify our economy and remind the world of Ector County’s leadership in the oil and gas industry.”
Nacero’s Chief Operating Officer Hal Bouknight said the company was impressed by the support shown by the ODC, Odessa’s business leaders, taxing entities and local residents.
“I’d always heard that Odessa’s citizens have a “can-do spirit,” but I was really impressed by just how hard people were willing to work to help bring us to the area,” Bouknight said.
Nacero’s news release detailed that all of the plant’s electricity will come from renewable sources, much of which will be produced on-site from solar panels co-located with the manufacturing facilities on Nacero’s 2,600-acre site, which will sit on the Penwell land originally slated for the failed FutureGen and then Summit endeavors.
The plant will be the first in the U.S. to make gasoline from natural gas and the first in the world to do so with carbon capture and sequestration. Sequestered CO2 will be transported via an existing on-site pipeline.
Odessa Development Corporation Chairman Tim Edgmon, in a news release, “This project proves once again that West Texas in general, and Odessa in particular, leads the nation in energy innovation and production.”
Burnett described Nacero as a perfect fit for Ector County. “The regional economic impact of this single facility will be in the tens of billions of dollars. I thank my staff and all those who worked with them for their hard work in bringing this incredible opportunity here.”