Economist Loren Scott told West St. Tammany Chamber members Tuesday that they are doing business in a state that fared better than the country as a whole through the 2008-09 recession and subsequent slow recovery, and that they are now reaping the benefits of an industrial boom in this part of the state, fueled largely by the low cost of natural gas.
Scott, former chairman of the economics department at Louisiana State University, painted an upbeat picture of the New Orleans economy and especially of St. Tammany Parish, which he described as a wealthy parish with the second highest per capita income in Louisiana.
While $5 billion in new projects would have been a good year for Louisiana in the past, Scott said, the state is poised to see $104.2 billion in new projects, with $42 billion of that underway or completed. St. Tammany’s share of that boom is $5 billion, with $2.1 billion underway or completed.
Scott cited three factors fueling the region’s industrial boom: the low price of natural gas here, the high price of natural gas in Europe — three times that in the U.S. — and the steep differential between the prices of oil and natural gas. Industries here are gambling on the price of natural gas staying low and the differential remaining high, he said.
They’re also betting that Europe “remains stupid — which is actually a pretty good bet,’’ he said, referring to European countries that have banned hydraulic fracturing, or fracking, despite the importance of the chemical industry and its reliance on natural gas.
Scott noted wryly that his comments might not play well in St. Tammany Parish, where there has been rampant opposition to fracking in the face of a proposed well, including a lawsuit filed by the parish.
“If you think the greens are strong in St. Tammany Parish and in the U.S., not even close compared to Europe,’’ he said.
The growth in Louisiana is heavily concentrated in the chemical industry and, geographically, along the Mississippi River and in Lake Charles, Scott said. His long catalog of projects included examples of that kind of growth, including an $850 million ammonia plant being built by DynoNobel International in Waggaman.
But he also mentioned the two hospitals being built in New Orleans, the expansion of Louis Armstrong International Airport, contracts for the Space Launch System at Michoud and developments at the Port of New Orleans, including the return of Chiquita Brands bananas.
In St. Tammany, Chevron’s new 35,000-square-foot Gulf of Mexico headquarters will bring more than 800 jobs by the end of 2016, he said. FedEx is building a new 175,000-square-foot distribution center in Covington that will open at the end of 2016 with a like number of jobs. And Pelican Entergy Consultants in Madisonville has announced a $5 billion investment that will bring 195 jobs by the end of 2018.
However, Scott also listed several businesses that he described as concerns, such as Cox Communications in New Orleans, which recently cut 125 jobs.
Two of the companies on Scott’s watch list are in St. Tammany: Globalstar, a satellite voice and data service company that moved from Silicon Valley to Covington in 2010, and Textron Marine, which is laying off 200 people from its armored vehicle plant in Slidell.
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