JACKSON (AP) — Mississippi lawmakers met in special session Friday and quickly approved a multimillion dollar incentive package for a company that plans to convert timber products into a crude oil substitute.

KiOR, a company based in Pasadena, Texas, is pledging to invest $500 million of its own money to build its first three processing plants in Mississippi, one of which will be near Bude in Franklin County.

Mississippi would give the company a $75 million loan.

‘‘The process of converting biomass into a crude oil substitute is especially suited for Mississippi, with our abundant supply of KiOR’s most needed raw product: wood,’’ Barbour said in a news release Friday. ‘‘It will increase the value of our raw wood products, and it fits hand-in-glove with our drive to expand our base of high-tech jobs.’’

Currently, KiOR is producing 15 barrels of renewable crude oil, or Re-Crude, a day at its demonstration plant in Pasadena, Texas. The company is expecting to produce 800 barrels of oil a day at its first Mississippi facility — in Columbus — and anticipates producing approximately twice that much at the other two Mississippi facilities in Newton and in southwest Mississippi near Bude.

An estimated 20 tons or 100 to 200 truckloads of wet biomass, such as wood chips, will be used at each full-scale facility in one day, depending on the size of the facility.

KiOR is not able to spend any of the loan money until the company signs a contract with a major oil refinery, Barbour said Thursday.

KiOR CEO Fred Cannon said Thursday that the company is negotiating with two oil companies to refine its product.

The bond bill that passed the House and Senate on Friday included $45 million for the loan to KiOR; $30 million was already available from the state. Friday’s bill also included $4 million for worker training, $1 million for biofuels research at Mississippi State University and $1 million for biofuels research at Alcorn State University.

A few lawmakers were skeptical about the KiOR project. Sen. David Jordan, D-Greenwood, said voters are still upset about a state-backed beef processing plant that failed several years ago.

‘‘I don’t want to get burned again. I want to be absolutely sure,’’ Jordan said.

Kirby responded: ‘‘I feel very confident with this.’’

In other business at the session, lawmakers voted to outlaw the sale or possession of synthetic marijuana.

The herbal concoction is sold in convenience stores and smoke shops under several names, including Spice.

The ban would take effect when Barbour signs the bill into law, which he has said he’ll do.