GEORGETOWN - A deal was sealed Friday on what is being called the biggest economic development project for Georgetown County since the steel mill came in 1967.

Santee Cooper's board clinched an agreement with American Gypsum, a Dallas-based company that intends to invest more than $125 million in a wallboard plant that will hire more than 100 people. The company will use a synthetic gypsum that is formed as a byproduct of pollution-reduction methods at the utility's power plants.

"It's a good deal for South Carolina; it's a great deal for this county," said Santee Cooper board Chairman Guerry Green, who described it as the biggest project since Georgetown Steel. Green has a screen-products factory south of Georgetown and lives in Pawleys Island.

Georgetown County has struggled with a high unemployment rate and several years of plant closings and layoffs. Though 100 jobs is not large compared with the 700 at International Paper Co., which is one of Georgetown's largest employers, the posts are described as good-paying jobs by those who helped work the deal. The project is seen as one that will have a ripple effect on the local economy because of the size of the investment.

American Gypsum is a subsidiary of Eagle Materials. Eagle was spun off from Centex Corp. last year. Centex is a major builder of homes in Horry and Georgetown counties, and the connection could produce another range of economic spinoffs as new homes continue to sprout across the area.

An announcement with more details is scheduled for 11 a.m. Monday at the Winyah Generating Station. Georgetown County leaders who participated in recruiting the company, Santee Cooper officials and Gov. Mark Sanford are to take part.

The S.C. Commerce Department sent out invitations but didn't participate in incentives or recruiting, officials said.

Green said Commerce Director Bob Faith told Santee Cooper to take the lead in trying to make the agreement with American Gypsum.

The company will get the usual tax credits for new jobs that are offered to all companies, but Commerce said that because the company was coming to the state for the gypsum, the state would not offer other incentives. The state gives a minimum of $3,500 tax credit for each job created.

Santee Cooper worked the deal with some of its own money, Green said.

"We closed the deal with savings that we'd saved in other places," such as cutbacks in advertising, he said.

He did not say exactly what incentives Santee Cooper offered, but the utility will be paid for the materials American Gypsum will use, as well as for steam to make the wallboard and for lease of about 60 acres near the Winyah plant, he said.

"By utilizing the synthetic gypsum in its gypsum wallboard production, American Gypsum will convert waste that would otherwise be landfilled into a valuable building product," the company said in a news release Friday.

"Additionally, the gypsum paper that American Gypsum uses is made from 100 percent recycled paper fiber creating a finished product from essentially 100 percent recycled materials," the statement said.

Most of the material for American Gypsum will come from the Winyah plant, but it will get some from Santee Cooper's Cross Generating Station, northwest of Charleston as well, Green said.

Use of the synthetic gypsum is a growing trend. Earlier this week, another gypsum company announced plans to build a new wallboard factory near a power plant in North Carolina.

When Santee Cooper said about a year ago that it would upgrade pollution-control devices at the Winyah plant, the utility started getting inquiries from gypsum companies, Green said.

The upgrade will produce even more gypsum than the devices make now. Currently, the material is dumped into holding ponds on the utility's property near the plant.

The American Gypsum statement said the power plant will start producing wallboard grade gypsum next year and the plant will be operational in 2007.

American Gypsum was interested in locating either at Cross or Winyah, but Winyah won because of a nearby natural gas line. The company uses gas in its process, Green said.

The announcement comes amid legislative review of the way Sanford has handled Santee Cooper. The first of three hearings was held Thursday and the second is set for Monday evening.

The utility staff worked on the project for about a year, beginning before the controversy over Sanford's firing of the previous board chairman and demands for more money for the state from the utility, Green said.

But the timing is significant in another way, Green said.

With many other power plants set to upgrade their pollution controls because of stricter federal laws, it was critical for Santee Cooper to ink a deal before the market for the gypsum expands, he said.

A deal like this is a significant way for Santee Cooper to add value to the state, as the governor has requested, Green said.

"This is the kind of thing we want to do," he said.

Lonnie Carter, president of Santee Cooper, praised his staff for their work in putting the agreement together.

"This is one of those things that's going to make a big difference," Carter said, "not only for our state but for our company, in many years to come."

American Gypsum will make a $125 million investment in a plant near Georgetown that will recycle gypsum into wallboard; 100 jobs are planned to be created by 2007.

The company plans to lease 60 acres near the Winyah Generating Station, owned by Santee Cooper, and pay for gypsum byproduct from the plant's pollution scrubbers and steam to use in manufacturing the wallboard.