SelectUSA focus on recruiting business
WASHINGTON — Louisiana’s economic development chief, Stephen Moret, told a crowd of potential foreign investors and others Thursday that the state is poised for the biggest economic boom in the nation, thanks to capital investments from South African energy giant Sasol and many more.
Moret credited the current environment of the nation’s natural gas revolution and low prices, along with the expansion of offshore oil-and-gas production in the Gulf of Mexico, as the ideal environment for south Louisiana to thrive over the next 20 years.
Moret spoke at the inaugural SelectUSA Investment Summit, hosted by President Barack Obama and the Department of Commerce to better link states and local business groups with foreign investors. The summit continues Friday.
“People are looking at lower energy costs here,” Obama said earlier in the day. “They’re looking at stability. They’re looking at the increased productivity of our workers. All these things are adding up.”
Obama said that through SelectUSA the government is launching the “first-ever, fully coordinated U.S. government effort to recruit businesses to invest and create new jobs” in America. “We’ll make sure that, for the first time, companies who want to do business in America have a single point of contact at the federal level to cut through red tape. We’re going to help you navigate national, state, local rules and regulations so that you can invest faster, open facilities faster, create jobs faster.”
Sasol North America President Mike Thomas said afterwards that Obama’s words were “music to my ears.”
Sasol, which already has projects in southwestern Louisiana, is currently planning the largest capital expansion project in Louisiana history: Sasol’s $21 billion ethylene cracker and gas-to-liquids complex in Westlake that will primarily convert natural gas to diesel fuel. The deal includes more than $250 million the state is sending Sasol’s way in an incentive package.
Sasol still has to go through the process of acquiring air quality permitting from the U.S. Environmental Protection Agency and wetlands approvals from the U.S. Army Corps of Engineers.
Thomas said Sasol is not seeking “special treatment” but, instead a “level playing field.” He credited Louisiana for having an inviting business environment.
“These processes can be very lengthy. The regulatory path that we’re required to follow needs to be certain,” Thomas said. “The president said things I love to hear.”
Thomas touted what he called Sasol’s groundbreaking gas-to-liquid approach that involves “crystal-clear, sulfur-free, aromatic-free” fuels. “It burns cleaner” and should be “perfect for the U.S. diesel market.”
Balancing out Thomas was Martin Mugica, president and CEO of Spain-based Iberdrola Renewables, which is investing heavily in wind and solar projects in the U.S.
Mugica said low natural gas prices are proving “challenging” for the renewable energy industry for now, but that he is optimistic that more environmentally-friendly energies are the path forward. Mugica said he backs a so-called carbon tax that is much-criticized by the oil-and-gas industry and would charge companies more for their levels of carbon emissions.
“It’s very controversial politically, but probably the right thing to do,” he said.
Moret said there is “tremendous interest internationally in Louisiana right now.” Texas and Louisiana are best suited to thrive with the natural gas boom and deepwater drilling in the Gulf.
Moret said there was major concern about the future of deepwater drilling after the 2010 BP oil disaster, but now projections show increases in Gulf production by 15 percent to 20 percent over each of the next five years or so.
While the initial natural gas boom from the Haynesville Shale and other shale production has slowed down substantially, Moret said, the state is just in a “transition phase” with a “massive amount of new capacity that’s going to be coming online.”
The next five to 10 years will bring a “massive increase in demand for shale natural gas” in the state, he said.
Liquefied natural gas export terminals coming online in Louisiana – $6 billion to $12 billion investments each — also would help the state, Moret said.
Unwilling to discuss specifics, Moret said talks are ongoing with potential “multi-billion-dollar” investors from Japan, South Korea, Canada, Australia, the United Kingdom and the Netherlands, among others.
He cited the energy and chemical industries primarily, but he also mentioned potential investments in the aerospace, automotive and software development fields to further diversify the state.