State Rep. Tony Shipley says ‘two independent private investors’ are ready to put in ‘excess of $50 million each’ into the venture.
THIS STORY COURTESY THE KINGSPORT TIMES-NEWS
By HANK HAYES
hhayes@timesnews.net
AN OLD GENERAL SHALE KILN AT THE FORMER PLANT IN DOWNTOWN KINGSPORT
The old General Shale brick making site off Main Street is being eyed as a location to process the carbon-based product into coke briquettes used by the steel industry.
A February white paper authored by Shipley and longtime coal scientist Richard Wolfe suggests coal could be converted into both carbonite and coke, in addition to coal liquids that could be refined into a transportation fuel.
Shipley, R-Kingsport, says “two independent private investors” are ready to put in “excess of $50 million each” into the venture.
“Their names are embargoed at this point,” said Shipley.
Earlier this month, Shipley named one potential investor — Energy Solutions from Oak Ridge.
Shipley said he is working with U.S. Sen. Bob Corker, R-Tenn., to deal with the Environmental Protection Agency on regulatory issues associated with the project.
When asked what those regulatory issues are, Shipley responded: “The silliness they’ve imposed on Kingsport in (ozone) containment.”
Shipley said he has provided to city officials an environmental comparison used from a similar Virginia venture “to compare to the General Shale environmental permit that was there before.”
The downtown project, according to Shipley, would emit “less than one-sixth of the emissions” that were produced by General Shale.
Shipley and Wolfe’s white paper said the city of Kingsport would be asked to buy the location and turn it over to the project developers.
One likely entity to be approached to buy the site — or come up with a lease arrangement — could be the Kingsport Economic Development Board.
But those talks haven’t begun yet, said Kingsport spokesman Tim Whaley.
A 40-acre commercial tract at the General Shale Main Street location had a $4.35 million appraisal in 2010, according to Sullivan County Property Assessor Bobby Icenhour.
Icenhour said General Shale is appealing that appraisal, which could also include an adjoining residential parcel owned by the company.
“They feel some of those buildings need additional depreciation. ... Even if they get that additional depreciation, it’s not going to amount to that much,” said Icenhour.
When asked about the city’s position on the project, Whaley said in an e-mail: “The viability of this project hinges entirely on the availability of private capital and/or large grants to bring it to life. We understand informally from Representative Shipley that there has been a good bit of progress on securing private venture funding, and at the point where private financing is firmly secured, the city will gladly examine how we might best assist in ensuring the project locates in Kingsport. ... We are not aware of any environmental issues with the site, however no reviews of the property have been conducted by the city of the site.”
The finished plant, according to the white paper, would be run by a corporation headed by Wolfe.
Shipley has been working with the Sullivan County-based NETWORKS economic development organization to make the project happen.
He speaks highly of the downtown rail lines to bring coal to the location.
“We are blessed with an enormous rail network that is underutilized,” Shipley said. “It’s designed for heavy loads. ... We’ve got a gold mine sitting there.”
Next week, Shipley will chair a meeting of a newly formed state House GOP Energy Task Force and attempt to sell the venture in talks with the Tennessee Department of Environment and Conservation, and Department of Economic and Community Development (ECD).
“That meeting is to keep everybody on the same track,” he explained. “We’re discussing education credits (with ECD). ... Northeast State has stepped up to the plate to develop training (for the carbonite plant) at the RCAM (Regional Center for Advanced Manufacturing).”
Shipley adds there would no need for lawmakers to pass legislation next year to make the project happen.
Past legislatures, for instance, passed jobs tax credit bills to make large economic development projects a reality during Democratic Gov. Phil Bredesen’s administration.
“This is taking more of a Republican approach than a Democratic approach ... a case in point is the multimillion dollar case the state laid out for Volkswagen (in Chattanooga) is not going to be requested by a Republican-controlled House and Senate and governor,” Shipley said. “We are not looking for state funding. We are after state assistance in moving the regulatory issues out of the way and helping us streamline the process to bring private investors to the table. ... The state of Virginia has invested $20 million into a project very much like we’re going to do, also under the control of Dr. Wolfe, in Norton, Virginia.”
Lastly, when asked about his personal ties to the project, Shipley insisted: “I have no financial interest.”
