### Inside:**~Calendar** 

# MONEY Sectio

f I· 

# Expansion to**preven~** 

# anotherLivingston

By NAN POWERS 8t.t.Un.t"H Writtr

BATON ROUGE

- .Formosa l'lostics Corp. can't forget the dav in 1982 that a train loaded with a toxic liquid it msnufaclures derailed and l eaked 

### all over the lillie southeast Louisiana town of Livingston.

Abnut 2,700 r >eople were kept from their h(lmes for two weeks hy explosions, fires, spills end chemical smoke

. The bill: $17 million in cleanup costs end $39 million in lawsuits against IUinois Central Gulf Railroad

. lnvestigstnrs di!l<:uvered that the engineer had been drunk and asleep dur

- ing the train trip.

'We got s lol of bad press even though the liability wasn't ours, " Formosa plant manager Alden Andre 1111id

.

Now. (h'e years later, the compAny hRS decided to ensure that it never has another Livingston

. Formosa will build a plant to t urn the t.oxic liquid vinyl chloride. a known cancer-causing 1genl. into polyvinyl chloride, a nn rmless white powder

.

"We realized shipping**ha.u~rd** lUS mntcrio.ls wasn't the thing t.o ceep**doin~."** Andre SAid

. "We feel ve are rna king a contribution to IQCiety

."

The plant will account for $75 nillion or the $154 million the ompany plans to spen d at iLs 35-acre s ite in Baton Rouge.

Other proposed improvements nclude expanding the chemical**!ant '~**  capacity, adding a new roduct lo it.q line and giving the umpany mare power from iLs lectric plant.**~tpansion** 

### will bring jobs The expanRi<m is expected 

### to ·eole 65 permanent**job~** a. nd 450 Hlstruction jobs in the Baton ouge areo. 

### The upo r JSion plans have 1rned the porent company's 1airman. Taiwanese tycoon and**1~ines~mao** Y.C

. Wang, the out

- 

# .'We realized ship-

. ping hazardous materials wasn't the thirig to keep doing. · We feel we are mak

# ing a contribution to 

# society.' Alden Andre Fonnosa Plastics manager standing Businessman of the Year Award from the World Trade Center in New Orlesns.

Formosa Plastics' main pur pose is 

### to manufacture the base component of polyvinyl chloride pipe, the white plastic pipe best known for its use in residential plumbing systems.

Fonnosa makes four products : chlorine, ethylene dichloride, vinyl chloride monemer and caustic soda. The first 

### three are intermediate products in the process that results in the PVC resin that is converted into pipe at Formosa's plant in Delaware. Caustic soda is a byproduct of chlorine, used in 

### the aluminum and paper industries

.

The increasing popularity of the PVC resin and pipe was a big factor in the company's expansion plans, Andre said. Demand is growing at the rate of 4 percent to 

### 5 percent a year. 

### Formosa revives

.operation

There also are new uses for the rHin end pipe. The state of Cali : fornia recently approved the pipe for drainage culverts on slate highway projects, and the re!lin is being used in wallpaper and flooring

.

. Formosa hopes that after the expansion. it will capture 17 percent of the U

.S

. market shore of PVC

. Today, the company has 10 

### Manager Alden Andre sees growth ahead for Formosa Plastics' Baton Rouge plant, now undergoing $154 million expansion.

. STAFF PHOTO BY DARlENE P1£RCE percent, Andre said

. Formosa's plant was built in 1935 by Allied Chemicals

. Allied operated the plant until 1978, when it sold the plant t.o Imperial Chemical lndustrie$ Ltd., a . British company.



### ICI kept the plant for two years. then sold it to Formosa Plastics Corp.• a U

.S

. subsidiary or the**~ant** T11hyanese firm For- mosa Plestics Group. In 1986. the latest year for which ligures are available

. the privately held parent company reported $3

.7 billion in assets.

ICl sold the plant because of substantial losses, Andre said

.

But under Formosa. 

### the plant hfts begun to show a profit, and for the first time. in 1986, 

### started returning profits to the parent company. he said

.

A new manor.ement**r1hilo~.-.nhv** that emphasized capital improvements made all the difference, said Andre. who has been 

### with the plant for 

### 25 years and plant mennger since 1982

. 

### Power plant a crucial a.sset

Previous owners "just kept il going like an old car you don't want t.o put money into." he said.

Formosa poured $40 million into th,.**nltu~f** ..... : ..: ... - _ ... _ ... _:• • • And. though a Gulf SLates Utilities Co. power plnnt is next door. Formosa spent $13 million on n . n electric co-generation plant that produces 6() percent or ita power. That hAs reduced its reiiance on GSU's higher co!t power Md allows it to be cost-competili· ve. The power ph1nt cKpens ion w ill nllow the company' •

# --**----------------------------------------------------------------t-----~ '-**  -··-••.,;; I



### V.J. 'Pop' Rogers checks his charts in the control room of Formosa Plastics' electrical cogenerationplant. The company's expansion plans 

### will double the electrical facility's capacity

. : STAFF PHOTo 

### av oAA\.ENe Pf£RCE 

# Plastics

From G-1 to produce 95 percent of its electricity needs. 

# Formosa hopes that after the expansion, 

# it will capture 17percent ofthe**U~S.** 

# market share of

# PVC. Today, the company 

# has 10 percent. But, the company has cor- rected many of the problems, and will 

### be even better equipped after the expansion. Andre said. "The new plant 's technology is improved, and fugitive emissions will 

### be reduced ," he said

. So important is the power plant, Andre said, that "If we hadn't done it, we wouldn't be sitting here. We would have had to shut down."

The company also cut the number of employees from 400 to new plant will be able to manufacture 1,250 tons a day. from the state Department of Environmental Quality. The expansion can't begin, however, until Formosa gets its 

### DEQ permit. 

### A spokesman (or the department said the request is under review

. 

# ';:==:

Meanwhi!!, Formosa worries about the physical health of its employees and the**corpc~;;t;;** 

### he

.

Q!th of the comp. any. 175.

.

Formosa pians another round of spending in the next two years that 

### will nearly quadruple what it spent in the previous five.

Formosa will: • Build a plant to produce the leW product, polyvinyl chloride

·esin. Formosa will be able to nanufacture 1,050 tons a doy.

· Build a new vinyl chloride 1anufacturing plant

. Current 

### ca- acity is 600 tons per day

. The 

# >PEC

1mG-1

m Mexico "' · I

.. • .,. Double the capacity of the power plant..

.,. Spiff up the landscaping, which is virtually non-existe nt. The p!ent's new office building is surrounded by tall weeds and looks abandoned.



### . Leaks an ongoing problem The chemical spill in Liv· ingston isn't the only problem the plant has had

.

There have been several vinyl chloride leaks resulting In fines The latest was in September t987. Formosa wa. s fined $44,500 and ordered to install a new incinerator to destroy vinyl chloride instead of releasing it. said Chris Roberie, DEQ program munager for enforcement.

' 'I'm nut saying it's a bad com - pany," Roberie said

. 

### "All viny l chloride producers are under inteMe scrutiny because of the stringent regulations regordintc the chemical. Most 

### of them have been assessed**penalti~s** in the**la~t** two Ul three years." 

# The chances of 

# OPEC and independent producers reaching agreement any time soon rm ;,...:-:-

# productinr.**cu.t ~::**  

# ,. ...

# .,ear slim Each year, the parent company hosts its own one-day Olympic fest ival i n Taipei. Each plant sends twu employees

.

Chairman Wang. 70, opens the festival by leadin!( a five-kilometer run fnr all the contestants
. • Thill year. Andre se nt mechan· ical**en~neer** Ken Jefferson nnd chemical engineer 

### Paul Lanoux

. They both rinished the race, pleasing their fellow employees.

lessened by the fact that prices, adjusted for inflation and the de- ,>reciation nf the U

.S. dollar

. al ready are as lnw as in 198n. he nutlook for ro •••
• ("lo u •,.l 

# l**·**