In Louisiana, we’re maybe just a bit spoiled.
As we are one of the centers of the nation’s energy and transportation networks, we have become quite used to hearing announcements of a new industrial facility that will be built at a cost of hundreds of millions or even more than $1 billion.
Most places in the United States would have a public holiday and throw a parade for the occasion, should a billion-dollar project land in the neighborhood.
Still, it’s front-page news across the state when an $8 billion investment is made in our booming industry of petrochemical manufacturing.
And it’s particularly noteworthy when that is only the opening stage of what could be an investment of nearly $22 billion in our state.
The Johannesburg-based Sasol has greenlighted construction of an $8.1 billion ethane cracker and chemical complex near Lake Charles. If a proposed gas-to-liquids facility is eventually approved by the company, it would raise the investment to the higher figure.
That could eclipse the estimated $20 billion Sabine Pass liquefied natural gas export project by Cheniere Energy. It is under construction in Cameron Parish and considered the largest single capital investment in Louisiana history.
Two chroniclers of Louisiana’s economy are LSU economists Loren Scott and Jim Richardson, who produced a two-year economic outlook for the state. “We have run out of adjectives to describe the industrial boom underway in the Lake Charles MSA (region),” the forecasters said. “We have tabulated a remarkable $81.7 billion in industrial announcements for the two-parish region. Of that total, $30.2 billion are already underway — a figure 7 to 10 times larger than we would typically report for the whole state in the past.”
The report by Scott and Richardson underscores the tremendous potential for growth in Louisiana driven by low natural gas prices, produced in part by a boom in “fracking” technology.
“Today, Louisiana is the epicenter of an industrial renaissance surpassing anything we’ve witnessed since perhaps the industrial revolution in 19th-century America,” Gov. Bobby Jindal said Monday of the Sasol commitment.
That’s a huge historical parallel, but it may be the correct one. This economic impact is not limited to southwestern Louisiana, even if that is where the latest records are being set. Major projects also are underway or coming from the drawing board in the Mississippi River petrochemical corridor between Baton Rouge and New Orleans.
It is indeed manufacturing, even if it is the chemicals that go into a multitude of products, from detergents and lotions and cleaners to piping and paint, not the cars or washing machines that are usually invoked in the mind’s eye.
Let the boom roll on. And let’s not get blasé about the odd billion-dollar project elsewhere. They are all contributing to a new phase in Louisiana’s economic life.