Company drops plan for $2.3B methanol plant in Washington

SEATTLE (AP) — A company backed by the Chinese government on Friday ended its seven-year effort to build one of the world’s largest methanol plants along the Columbia River in southwestern Washington, following a series of regulatory setbacks and a long debate over its environmental footprint.

Northwest Innovation Works proposed a $2.3 billion project to take fracked natural gas from Canada and convert it into methanol, which it would then ship to China to make ingredients for plastics used in everything from iPhones to clothing to medical devices.

The state Department of Ecology denied a key permit for the project in January, saying it would create too much pollution and have negative effects on the shoreline. On Friday, the company notified the Port of Kalama it was terminating its lease, saying the regulatory environment had become “unclear and unpredictable.”

Economic development officials in southwest Washington blasted the state for dooming the project, saying that the company's methods of making methanol from natural gas would have been cleaner than making it from coal, as is done elsewhere. That would have benefitted the environment while creating 1,400 construction jobs and 200 family-wage permanent positions, they argued.

“NWIW did everything right, and their understandable decision to pull out of this project is a real loss for families trying to make ends meet, the future of economic development in our state, and our environment," Port of Kalama Commissioner Troy Stariha said in a written statement.

A review required by the state found that the plant would boost the amount of greenhouse gases released into the atmosphere, but not as much as if the methanol were made elsewhere.

Environmental groups, including Columbia Riverkeeper and the Washington...