Exterran gets state tax credit for Youngstown plant

By Marc Kovac



The Ohio Tax Credit Authority has approved a seven-year, 55 percent tax credit for Exterran Energy Solutions’ 65,000-square-foot building in Youngstown.

The building, at the Salt Springs Road industrial park, will help service the area’s burgeoning oil-and-gas industry and will create more than 100 jobs.

The refundable tax credits will count against what Exterran will pay in corporate activity or income taxes, based on the state income taxes withheld on new, full-time employees.

Plans for the Houston-based company’s new $13.2 million facility in Youngstown surfaced in December.

The company plans to spend $9.3 million on building construction and $3.9 million on machinery and equipment and hopes to be open for business by the end of the year.

Lt. Gov. Mary Taylor will help announce the project officially today during a press conference in Youngstown.

City officials are calling the investment the second-largest economic- development project Youngstown has landed related to Marcellus and Utica shale formations. V&M Star, at $650 million, is the largest.

“It is enormous for our community,” said Sarah Boyarko, manager of business development at the Youngstown/Warren Regional Chamber, which was first contacted by the company about the potential expansion seven months ago. “It’s a great opportunity — new employment opportunity. They’re an impressive company.”

Exterran provides equipment and services for companies involved in oil and gas production.

“We focus on providing total solutions for oil and gas after the wellhead,” said Sean Clawges, director of global manufacturing expansion. “After the well is drilled, we provide the solutions to treat, to dehydrate, to do any of the different processing and treating of oil and gas ... so that it can be a usable commodity.”

The state tax credit, for example, means a company paying $100 in state income-tax withholding for a new worker would be credited with $55 toward its other state tax obligations (commercial activity, state income or insurance premium tax liabilities), based on a 55 percent credit.

The company’s new payroll in Youngstown is expected to be about $4.9 million, with 103 workers earning an average hourly wage of $23. Many of the new positions — about 65 — will be welders, Clawges told the Tax Credit Authority.

“We plan to have this facility built and in operation by the end of this year,” he said. “We’re targeting a Dec. 1 start. That’s very aggressive — very, very aggressive — to build a complete new facility, but that’s what our plan is at this time”

Exterran considered sites in Pennsylvania and West Virginia for the new facility.

“We really feel that Youngstown has a great work force,” Clawges said. “The city and the state have all come together and put a really nice package together for us ... and we’re really excited to be coming to Northeast Ohio.”

The city spent about $4 million in state funds for a new road and utility lines at the location, and gave the 20-acre site to the company.

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