Al Jazeera investigates US and Chinese interests behind bid for $4.5B methanol plant in an underserved black community
Originally published on Al Jazeera America – April 14, 2015
***This is the first in a three-part investigative series on China’s inroads in Texas’ energy industry. The second part looks at the historically black community near the proposed site, which is already flanked by chemical plants. The third looks at Beijing’s recent push to “hunt down” escaped Chinese officials in the United States. The project follows a series on another push by Chinese politician-investors and U.S. officials for a methanol plant in a predominantly black neighborhood of St. James Parish, Louisiana.
TEXAS CITY, Texas — The administration of former Texas Gov. Rick Perry, a likely 2016 GOP presidential contender, appears to have had a hand in helping two Chinese politician-entrepreneurs — who in recent years have come under public scrutiny on allegations of environmental abuses and corruption — park assets in a proposed methanol plant beside an underserved, predominantly black community in southern Texas.
What would be one of the largest methanol plants in the world, valued at $4.5 billion and receiving hefty tax incentives from Texas City and the state, would send its product to China, according to promotional materials. But China has in recent years struggled to find a use for all its methanol, which is used in producing biodiesel and as a solvent.
The market for Texas-made methanol remains unclear. But the Chinese entrepreneurs’ bid to pour funds into an overseas enterprise comes at a time when Beijing’s sweeping anti-corruption campaign has officials and industry magnates scrambling to put their wealth abroad to avoid losing it in probes that have targeted China’s ruling class.
In January an Al Jazeera investigative series revealed that Louisiana Gov. Bobby Jindal, another probable 2016 GOP presidential candidate and a Perry ally, met with China’s consul in Houston and Yao Caoliang, the CEO of the U.S. subsidiary of a Chinese energy giant planning to build a $1.85 billion methanol plant in St. James Parish, Louisiana. The investor behind that bid, Wang Jinshu, is a Chinese politician and entrepreneur who is increasingly coming under fire in Chinese state media for allegedly shirking environmental regulations and receiving government credits after misreporting green technology measures. The plant would receive a $9.5 million incentive package from Louisiana.
Now an Al Jazeera investigation has revealed the Texas methanol plant’s connections to a Republican presidential hopeful, Chinese politicians publicly accused of misdeeds and Chinese-American organizations alleged to secure the flow of information and technology from the United States to China.
In August 2014, Fund Connell USA Energy and Chemical Investment, a company incorporated by the Chinese moguls in Delaware just before the deal was announced, leased Shoal Point, an empty 900-acre parcel of land on Texas City ship channel, for two years for $200,000 in order to conduct due diligence, according to a copy of the land lease obtained by Al Jazeera and Texas City officials.