Cheniere Energy closing in on $138M tax break for LNG expansion in Cameron Parish

A company that’s expanding its liquified natural gas facility in Cameron Parish is one step away from getting a $138 million break on its local property taxes.

The Louisiana Board of Commerce and Industry, whose members are appointed by the governor, approved Cheniere Energy’s “mega-project” status application Wednesday for its $6 billion plans to expand the Sabine Pass liquified natural gas export facility, where the fuel is converted for shipping overseas. If Gov. Jeff Landry gives his approval, the company will be exempt from paying 93% of its property taxes over at least the next five years.

With the increased exemption, Cheniere would pay $10.5 million a year in property taxes instead of $29.8 million, according to Louisiana Economic Development calculations. Without ITEP, the company would have owed closer to $150 million over the five-year period.

The mega-project incentive has been part of the Industrial Tax Exemption Program since 2016, when former Gov. John Bel Edwards made substantial changes to one of the state’s most lucrative business incentive programs. Landry has undone most of that policy, but he’s retained the mega-project designation with some changes.

For an investment to receive that distinction under the latest rules, a company must spend more than $500 million in Louisiana or exceed 200% of the average business investment in the parish over 10 years. An applicant can ask for a waiver of between 93% and 100% of their local property taxes.

Cheniere is the second company to receive official mega-project status under the revised ITEP rules. The first was Syrah Resources, whose application was approved in June. The company provides raw materials needed to make batteries for electric vehicles and is investing $587 million in its Concordia Parish facility. Its expansion includes six buildings, three power distribution centers and increased production capacity.

Louisiana Economic Development officials were not available Friday when asked for details on mega-projects approved under the Edwards administration.

The Industrial Tax Exemption Program dates back to 1936, instituted to attract major businesses to Louisiana that otherwise would not have come. The program originally provided a 100% tax exemption on property taxes no matter the investment amount. Companies often exploited loopholes in state law to renew their tax-free status beyond the maximum allowable 10 years.

In 2016, Edwards issued an executive order to require companies either create or maintain jobs in order to qualify for a ITEP break and gave local taxing authorities power to approve or reject applications from companies doing business in their jurisdictions.

Property taxes generally go to local governments to fund things like schools and police departments. It’s one of the reasons locals were given say-so over the projects, because missing out on tax revenue impacts local budgets.

Edwards also reduced the 10-year incentive to five years plus a five-year renewal option and lowered the tax exemption rate to 80% for renewals. In 2018, the Louisiana Legislature set the rate at 80% for all ITEP projects.

In 2024, Landry changed the ITEP rules to no longer require companies to disclose how many jobs they create, keep or eliminate. And instead of local taxing authorities having power over a company’s participation in the program, the Landry administration supported the creation of new parish-level ITEP review boards with appointees from local taxing agencies, typically the school board, sheriff’s office and parish council or police jury.

Jan Moller, CEO for the progressive economic policy nonprofit Invest in Louisiana, said Landry’s ITEP revisions have hurt local agencies that benefitted from the tax dollars collected under the rule changes Edwards made in 2018.

“The big question that we never answer with these projects is the ‘but for’ question,” Moller said. “Would they still come to Louisiana ‘but for’ this lucrative tax break that exists nowhere else but here in Louisiana?” he added.

Moller was a member of the Board of Commerce and Industry under the Edwards administration. He said there was no business impact after local agencies were given say-so over ITEP, and more industry tax dollars flowed to help parishes pay for projects such as new schools, roads and bridges.

“Those reforms did nothing whatsoever to slow down investment in Louisiana industry, and it’s a real shame that those reforms were rolled back and we went back to the status quo,” Moller said.

The Louisiana Association of Business and Industry has said Edwards’ ITEP overhaul resulted in fewer applications for the tax incentive.

However, Together Louisiana, a progressive coalition of civic and church groups, points to numbers showing the industrial tax break was given to more companies after the 2016 executive order than when the 100% tax exemption was available. The group attributes the drop in ITEP applications to an administrative rule change that cut down the amount of paperwork required for renewals.

The Board of Commerce and Industry also approved 26 other ITEP applications at Wednesday’s meeting, under both previous rules and the newest 2025 rules. When combined, the projects represent nearly $7.9 billion in investments and an estimated $135.3 million in tax breaks, according to Louisiana Economic Development. An estimated $19.3 million in local taxes will be collected from these projects.

“That’s a big number,” board member Wesley Wheelis, a West Monroe financial adviser, said at the meeting about the combined project value.

“It is a big number,” added member Jerry Jones, a Baton Rouge attorney, saying that any day a company invests in Louisiana “is a good day.”