TERRE HAUTE, Ind.—Recycled carbon black manufacturer Pyrolyx U.S.A. has obtained approval for up to $70 million in bonds to finance the building of a second rCB plant in Terre Haute.
The Terre Haute Economic Development Corp. approved the issuance of the Solid Waste Facility revenue bonds in December, and the City of Terre Haute gave its approval in January, according to Pyrolyx U.S.A. CEO Thomas Redd.
"The maximum amount of the bonds is $70 million, but this is the maximum, and we are expecting the actual amount borrowed to be less than this," Redd said.
Pyrolyx estimates the construction of the second Terre Haute plant at $52 million. The company expects to break ground on the facility in the first quarter of 2020, and have it operational in the second quarter of 2021.
"We have not closed financing on Plant 2 yet, so the schedule assumptions are dependent on that successful financing close," Redd said.
When completed, the second Pyrolyx plant will have a production capacity that is identical to the existing Terre Haute plant, which is 13,000 metric tons of rCB annually, according to Redd.
The company expects the new plant to bring 50 new jobs and $2.5 million in annual payroll to Terre Haute, he said.
The bonds for the first Terre Haute Pyrolyx plant have a 10-year payback; the company does not yet know the exact terms of the bonds for the second facility, according to Redd.
"We will be working to have a longer payback period (for the second set of bonds)," he said.
In November, Pyrolyx A.G.—Pyrolyx U.S.A.'s Stegelitz, Germany-based parent company—signed a five-year agreement with the Tire Division of Continental A.G. for Pyrolyx to provide increasing amounts of rCB to Conti tire plants worldwide, rising to 10,000 tons.
Redd said he could not comment directly on Pyrolyx's agreement with Conti or how it affected the decision to build the second Terre Haute plant.
"However, the additional capacity that the second plant in Terre Haute represents will be sold to customers in the U.S. and abroad," he said.