TUSCOLA — Employees of Equistar Chemicals were told Friday that the ethanol production plant in Tuscola will shut down permanently later this year due to poor market conditions.
“After a careful review of market conditions, we have made the difficult decision to permanently exit the synthetic ethanol business and close our Tuscola plant operations,” said Megan Borchers, a spokesperson for parent company LyondellBasell. “We will be taking a phased approach to closing the Tuscola plant. We are in the process of determining how many people will be necessary in each of the different phases.
“This decision was not taken lightly,” she added. “We have an incredible team of hardworking, dedicated people at our Tuscola plant who have safely and successfully maintained the last remaining synthetic-ethanol business in North America. Unfortunately, the synthetic-ethanol market has been deteriorating for some time, and these declining market conditions make operating this business long-term financially unviable.”
Borchers said the company expects to stop producing ethanol Oct. 31. Employees will be offered positions at other LyondellBasell holdings along with separation benefits and support.
“We are working closely with union representatives where applicable,” she said.
The company’s website said there are about 100 employees and contractors at the plant, which began production in 1953. It has a footprint of about 900 acres and in 2018, it had a payroll of around $15 million.
Ethanol is used in personal-care products, motor oil, water-filtration systems, binding agents and gasoline, to name a few items.
Brian Moody, executive director of Tuscola Chamber & Economic Development Inc. said the news was sad and disappointing for the Douglas County community, which has been home to a chemical plant at the U.S. 36 location just west of town for more than 50 years.
“Our first concern is with the employees and their families over the uncertainty they are experiencing,” Moody said. “We will now direct our focus to supporting the impacted employees by bringing resources and services to help them as they search for new career opportunities.
“We recognize the positive impact the facility has had on our local economy for over half a century,” he added. “We know the value which has been added to our region and the role this facility has played in building our community. Thousands of lives have benefited from the operations here.
“We have had a long, positive relationship with this facility and its employees. We want to recognize the people who built, maintained and safely operated the complex over these many years.”
Moody said his organization will do what it can to help Equistar employees find other work while trying to find other businesses for Douglas County.