Big Stipulations from Energy Security Partners Gets Cheap Lease on Land

Big Stipulations from Energy Security Partners Gets Cheap Lease on Land

So how do you get a 10-year lease on a big chunk of land and pay just $10 a year in rent?

If the $100 deal between Energy Security Partners LLC and the Economic Development Corp. of Jefferson County is any indication, you have to make some big promises.

The development group leased nearly 1,100 acres in northern Jefferson County to ESP, which plans to build a massive plant for turning natural gas into liquid fuel, including diesel. The project, touted as the largest economic development in state history, has a first-phase price tag of $3.7 billion.

The lease deal, executed March 30, was signed by Roger D. Williams, CEO of ESP, and George A. Makris, the chairman of the development corporation and the chairman and CEO of Simmons First National Corp. of Pine Bluff.

The lease states that “Base Rent shall be equal to $10 annually” for the 10-year term and $10,000 a year afterward. The development group bought the land, also on March 30, with $2.8 million from an incentive package it had approved in February.

What’s the catch for ESP? Well, the lease stipulates that the project must create at least 225 primary jobs “with an average hourly wage of not less than $40 per hour plus benefits.” ESP also promises to “expend at least $2,800,000,000 in capital investments in constructing, developing and improving” the facility. In case you got lost in all those zeroes, that’s $2.8 billion.

Makris, by the way, is not just a signer of the lease, but also an investor in the project. For that reason, he did not vote in the economic development group’s consideration of the incentive package. “I have a small investment in a common fund which has invested in the project,” he wrote in an email. “It is, in my opinion, a conflict for purposes of voting on any benefit for the project.”