Although Indiana Governor Mike Pence withdrew state incentives for a proposed fertilizer plant in the state, he announced he would not stand in the way of local officials working to make the plant a reality.

In May, Pence withdrew the state’s support for the project after concerns were raised by the Department of Homeland Security and the Pentagon about the Lahore-based Fatima Group, which makes calcium ammonium nitrate fertilizer, citing the company’s fertilizer had been used in explosives to harm U.S. soldiers in Afghanistan.

"The State of Indiana stands by its decision to withdraw support for the Midwest Fertilizer project since Department of Defense officials still have not been able to independently confirm Fatima Group's promise to replace their current fertilizer in Pakistan with a formula less susceptible to misuse by hostile forces in the region," Pence spokeswoman Christy Denault said in a statement.

"Despite a difference of opinion on the matter, Governor Pence respects the prerogative of local officials to continue to explore the possibility of moving forward," Denault said.

Officials in Posey County say they look to move forward with the project for a $2 billion fertilizer plant.

Tom Campbell, the U.S. Adviser for Midwest Fertilizer Corporation released this statement: "We are pleased with the Governor's decision to allow Posey County and Southwest Indiana to move forward with one of the biggest economic development projects in the state. We applaud the elected officials of Posey County for seizing the opportunity to bring a world-class facility to Southwest Indiana." 

The state originally offered a $1.3 billion tax-exempt municipal bond sale before the governor withdrew state support. Now, the county is weighing the sale of six-month securities by July 1 to refinance the state-issued notes, said John Taylor, executive director of the Posey County Economic Development Partnership.