Benteler - AGG Team Assists German Company with $900 Million Manufacturing Project in Louisiana

Challenge

The Austrian-and German-based Benteler Group, with 170 locations in 38 countries, wanted to establish its first hot rolling tube mill and steel mill in the U.S. The tubes will be used for exploratory drilling and transportation of oil and gas as well as for power generation and mechanical applications. The client asked AGG’s experienced Economic Development team for assistance with site location and regulatory and incentive issues, and to resolve those issues before site preparation and facility construction could begin. The project timeline required that once a site was identified, work on due diligence, permits, environmental, acquisition, improvements and incentives had to be completed or committed quickly.

Approach

AGG’s team worked with Benteler’s project team in engaging local counsel in negotiations and document preparation for state and local incentives; providing guidance on all environmental legal matters; resolving and accommodating mineral rights for operating wells on the site; finding a balance between required public reporting and project performance monitoring processes with Benteler’s private ownership; reducing structuring/transaction costs of local incentives; and securing commitments for infrastructure availability and costs. Senior engineer Alexandra Segers of SSOE led the site feasibility team. The work was constant and involved federal agencies, state and local governments and authorities, multiple private parties, and input from numerous advisors.

Result

On Oct. 26, 2012, Louisiana Gov. Bobby Jindal announced that Benteler would build a $900 million hot rolling tube mill on 325 acres in Caddo Parish, La., creating an estimated 675 direct jobs at full capacity, 1,000 construction jobs and an estimated 1,540 jobs for suppliers and service providers. The Louisiana Department of Economic Development estimates the cumulative economic impact of the project through 2035 to be more than $10 billion. Ground breaking was scheduled for spring 2013.