Pence Re-Opening Talks With Pakistani Fertilizer Company On Posey County Project

Remember that controversial $1.3 billion state loan to Midwest Fertilizer Corp. to build a fertilizer plant in Posey County that Gov. Mike Pence inherited from Gov. Mitch Daniels when he took office? That's the one Pence eventually cancelled after reports showed the newly-created company was owned by the Fatima Group, a Pakistani company that had been criticized by American military officials for making its products readily available to terrorists which they used to build bombs to maim and kill American soldiers. Gov. Pence today announced that he's reopening talks with the company after he says he has received assurances that it has cleaned up its act. Here's the text of his press release:

“In May of 2013, the State of Indiana withdrew our support for the Midwest Fertilizer Company and the Fatima Group’s project in Posey County based upon concerns expressed by U.S. Department of Defense officials over the company’s lack of cooperation in preventing its fertilizer produced in Pakistan from being used to harm U.S. forces in Afghanistan. Economic development is important, but the safety and security of our soldiers in harm’s way is more important. 

“Following Indiana's withdrawal of support for this project, U.S. officials have reported that the government of Pakistan and Fatima Group have provided an unprecedented level of cooperation and transparency in addressing the concerns that precipitated the withdrawal of our support. 

“Specifically, U.S. Department of Defense officials have confirmed that an experimental formula is being developed by Fatima Group to be more inert and less-detonable to limit its usefulness to extremists and terrorists. This week, the State of Indiana was informed that our defense experts completed the second series of tests on the experimental formula and described Fatima Group's efforts to improve the safety of its fertilizer as "commendable.” In addition, U.S. officials have reported that the government of Pakistan and the Fatima Group have implemented several positive measures to make it more difficult for extremists and terrorists to obtain the company’s products in the region. 

“With these assurances from the U.S. Department of Defense, we believe it is appropriate for the State of Indiana to reopen our discussions regarding state economic incentives for this project. With continued cooperation on the part of the government of Pakistan and Fatima Group, we remain hopeful that the State of Indiana will be able to renew our support for this important economic development project with the confidence that we have done so in a manner that put the interests of our soldiers and their families first.”

Pence Officially Withdraw's Financial Support For Fatima's Fertilizer Plant In Posey County

The day after his inauguration in January, Gov. Mike Pence placed on hold economic development incentives the administration of former Gov. Mitch Daniels had offered to a Pakistani fertilizer company, Fatima, to build a new plant in Posey County during the closing months of his administration after concerns were raised about terrorists acquiring ingredients for making bombs from their facilities in Pakistan. Today, Gov. Pence has officially withdrawn those incentives, ending speculation on how he would proceed. Pence said the lack of assurances from the Department of Defense that the firm's product wouldn't continue to be misused by terrorists in the Middle East led him to his decision. Here's the statement his office just released:

Following careful review, Governor Mike Pence announced today that Indiana has withdrawn the incentives the state offered to Midwest Fertilizer Company to build a fertilizer plant in Posey County.

On November 30, 2012, the Indiana Economic Development Corporation (IEDC) offered a package of incentives to Midwest Fertilizer Company to build a fertilizer manufacturing facility in Posey County. The Fatima Group, a Pakistan-based fertilizer company, owns 48 percent of Midwest Fertilizer Company.

In December 2012, Lt. Gen. Michael Barbero, the director of the U.S. Department of Defense's Joint Improvised Explosive Device Defeat Organization (JIEDDO), testified before the U.S. Senate that Fatima Group had been "less than cooperative" in efforts to reduce the improvised explosive device (IED) threat in Central and South Asia.

On January 15, 2013, the day after his inauguration, Governor Pence directed the IEDC to place the incentives for the Posey County project on hold pending a review in light of Fatima Group's ownership interest in Midwest Fertilizer Company.

For the past four months Governor Pence and officials from Indiana have worked closely with officials from the U.S. Department of Defense and others in the federal government to conduct a review of Fatima Group. The company has informed U.S. defense officials that they have a reformulated product that is less explosive, but U.S. officials have not yet tested the product. While testing of Fatima's product may address U.S. concerns, the testing will not be done in time to satisfy what the State understands is the company's financing time schedule.

Governor Pence's statement follows.

"I did not take this decision lightly. Economic development is important, but the safety and security of our soldiers in harm's way is more important.

"Throughout the past four months, our administration has worked in good faith to evaluate whether our state should be involved in this project. I am aware of Fatima Group's efforts and cooperation with federal defense officials in recent weeks and believe their actions to be sincere.

"While we have been encouraged by promises made by Fatima Group to replace production of their current fertilizer with a more inert and less explosive formula in Pakistan, at this point in time, U.S. officials have not been able to independently confirm this fact and, as such, Indiana will not be moving forward with this project.

"Without assurances from our Defense Department that the materials which have been misused by the enemy in Afghanistan will be permanently removed from production by Fatima Group in Pakistan, I cannot in good conscience tell our soldiers and their families that this deal should move forward."