that by 2025 , the investment will create and support 317,000 jobs and $ 76 billion in tax revenue annually . The Gulf Coast investment is well underway , with 53 percent completed or under construction .
Recognizing Potential for the Appalachian Region
The Appalachian region is a superb location for increased chemical and plastics capacity . The Marcellus and Utica shale formations are among the world ’ s largest-known reserves of natural gas , and the Rogersville formation in Kentucky is another potentially significant resource . These formations are rich in NGLs , making them especially valuable to chemical manufacturers . The region is near manufacturing markets in the Midwest and along much of the East Coast — key customers for chemical and plastics products . All of this adds up to an exciting opportunity for growth .
“ The Appalachian region has distinct benefits that could make it a major petrochemical and plastic resin-producing zone ,” says ACC President and CEO Cal Dooley . “ Several companies have already announced investment projects , and there is potential for a great deal more .”
Shell ’ s petrochemical complex in Potter Township , PA , is a prime example . According to Pennsylvania Governor Tom Wolf , it is the largest industrial investment in the state since World War II .
There is a clear opportunity to create economic value and jobs by encouraging petrochemical manufacturers and their downstream producers to locate in the quad-state region of West Virginia , Pennsylvania , Ohio and Kentucky . The supply chains of other manufacturers and services would grow in response to the expanded petrochemicals capacity . Increased business activity and hiring would boost household earnings , supporting additional spending and re-energizing local economies .
An ACC report quantified these potential economic benefits . It found that the quad-state region could attract $ 36 billion in new chemical and plastics industry investment and create 100,000 permanent new jobs by 2025 , including 25,700 chemical and plastic product manufacturing jobs , 43,000 jobs in supplier industries and 32,000 jobs in communities where workers spend their wages , along with $ 2.9 billion in new federal , state and local tax revenue annually .
Building the Appalachia Storage and Trading Hub
Those seeking to map the region ’ s economic future are asking how to make it happen . What would enable the chemical industry and other manufacturers to take the area ’ s economy to the next level ?
One of the answers is energy infrastructure — specifically , a storage facility and pipeline distribution network for NGLs and intermediates . This type of infrastructure would give companies ready access to the resources needed for significant and sustained growth — the kind that leads to high-paying jobs and supports a chain of supplier industries in the region .
What has been proposed is a large-scale infrastructure project in which up to 100 million barrels of NGLs would be stored in a system of underground caverns , salt caves and other nonporous formations . In addition , 3,000 miles of pipelines would move intermediates to industries along a 454-mile corridor in West Virginia , Pennsylvania , Ohio and Kentucky .
The Appalachia Storage and Trading Hub is in the conceptual stage but quickly gaining momentum . It took a big step forward earlier this year when Appalachia Development Group , LLC was invited to submit a Part II Application under the U . S . Department of Energy ’ s Title XVII Loan Guarantee Program . The invitation was for a $ 1.9 billion loan guarantee to support the development of infrastructure for the hub . It ’ s the first of several steps in the process to secure a conditional commitment and final loan agreement .
Benefiting the Entire Nation
The Appalachia Storage and Trading Hub is a vital infrastructure project that could help strengthen the U . S . economy and improve energy and national security . Increased natural gas production in the Appalachian region enables the nation to use more ethane domestically , some of which could be sent to the Gulf Coast region via pipeline in order to support new chemical and plastics industry investment projects there . The new investment enhances opportunities to export chemistry and plastics , which can improve the U . S . trade balance .
Leading the Way
West Virginia lawmakers are championing the hub ’ s development . Senators Shelley Moore Capito and Joe Manchin along with Senator Sherrod Brown of Ohio are sponsoring the Capitalizing on American Storage Potential Act , Senate Bill 1337 , which would ensure eligibility for regional NGL storage hubs under the Department of Energy ’ s Title XVII Loan Guarantee Program . Congressmen David McKinley and Evan Jenkins are co-sponsoring House Bill 3143 , and Capito has introduced the Appalachian Energy and Manufacturing Infrastructure Revitalization Act , which would reform federal permitting for energy infrastructure .
State officials are engaged . A resolution highlighting the hub , its significant economic potential and supportive legislation and policies has been introduced in the legislatures of West Virginia and Kentucky . Similar resolutions are in the works in nearby states . Meanwhile , governors in the region are advocating for the hub .
ExEdge
West Virginia has a long history of manufacturing , producing everyday items from spark plugs and tableware to charcoal and kitchen cabinets .
Source : www . westvirginia . gov
Defining the Next Steps
The Appalachia Storage and Trading Hub could spur growth in the chemicals , plastics , refining and downstream manufacturing industries while providing out-of-work coal miners with new job opportunities . It would require thousands of skilled workers and a variety of STEM-related skills ranging from geology and pipe fitting to mechanical and chemical engineering .
“ For decades , those who have lived in and studied the Appalachian region have envisioned a thriving center of manufacturing activity , and they know that energy infrastructure — the hub — will be critical to unlocking the opportunity ,” says Dooley .
The potential benefits of the Appalachia Storage and Trading Hub are crystal clear . Will it become the region ’ s next success story ? Stay tuned . •
WWW . WVEXECUTIVE . COM SPRING 2018
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