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Posted by Heidi Schwartz
Benteler International has broken ground on the first phase of a $975 million steel manufacturing project under construction at The Port of Caddo-Bossier in Shreveport. The project’s first phase—a hot-rolling seamless steel tube facility—will be completed in the third quarter of 2015. A second phase will lead to the opening of a steel mill with an electric arc furnace in 2020. When complete, the project will span 1.35 million square feet on 330 acres at the port.
The Benteler Steel/Tube division will create 675 new direct jobs with the project. A Louisiana State University economic impact analysis estimates an additional 1,540 indirect jobs will result, for a total of more than 2,200 new jobs. An estimated 1,000 construction jobs will be created by the Benteler Steel/Tube project, and LSU estimates the project will result in $2.7 billion in total new earnings and a cumulative economic impact of $16.2 billion for the Northwest Louisiana region over the next two decades.
Gov. Bobby Jindal said, “This project is one of the largest manufacturing investments in the history of Northwest Louisiana. It will strengthen our state’s economic momentum and create great new manufacturing jobs for our people. Benteler considered building this new project in a dozen other states, but chose Louisiana because we are in the heart of America’s energy corridor and because we have a strong business climate, world-class shipping infrastructure and the best workers in the world. This historic investment will continue to grow our economy and provide our people with great careers for generations to come.”
Benteler selected Louisiana after a lengthy, competitive site selection process that included 13 states and more than 100 potential sites.
“This new manufacturing facility—our first in the U.S.—is an important part of our global growth strategy,” said Matthias Jaeger, president and CEO of Benteler Steel/Tube GmbH. “With more than 25 percent of our steel/tube products already flowing into the United States, and demand expected to increase, this new Caddo Parish plant is poised to play a critical role in supporting the U.S. domestic energy industry.”
Based in Paderborn, Germany, Benteler Steel/Tube is a business unit of privately held Benteler International AG, which is based in Salzburg, Austria. The seamless steel tubes produced by the facility will be used for the exploration and transportation of oil and gas, as well as for the generation of power and mechanical applications.
The output of the new Louisiana facility will be destined for such locations as Illinois, Indiana, Ohio and Texas. The $975 million facility will be capable of producing up to 320,000 tons of steel tube product annually. Benteler’s analysis of Oil Country Tubular Goods (OCTG) markets in the U.S. shows strong demand through 2035 as the nation reduces energy imports and increases domestic production.
To secure the project, LED offered Benteler a customized incentive package that includes performance-based grants totaling $57.4 million to reimburse site development, infrastructure and equipment costs incurred by the port and the company over the next few years of construction and operations; a performance-based grant of $12.75 million to reimburse certain relocation and internal training expenses; and the development of the 65,000-square-foot BPCC Center for Advanced Manufacturing and Engineering Technology now under construction on the campus of Bossier Parish Community College in Bossier City, LA.
The BPCC Center for Advanced Manufacturing and Engineering Technology will focus initially on meeting the training needs of Benteler. Once initial training needs have been met, the facility will serve the broader needs of growing manufacturers throughout the region.
The total value of the new training center will be approximately $22 million, including land, infrastructure, building and equipment. The Greater Bossier Economic Development Foundation, the City of Bossier City and the Bossier Parish Police Jury will contribute a combined $1 million, of the $22 million total, to provide road and other infrastructure improvements needed for the new training center.
Other regional partners contributing to infrastructure improvements for the project at the port include the Red River Waterway Commission ($6 million), The Port of Caddo-Bossier ($3 million) and the Caddo Parish Commission ($2.6 million).
In addition, Benteler Steel/Tube will receive the services of LED FastStart® and will use Louisiana’s Quality Jobs and Industrial Tax Exemption incentive programs.
“We’re extremely grateful to see the excitement of Benteler’s historic investment in our community become a reality as they break ground on their new home at The Port of Caddo-Bossier,” said President Erica Bryant of the Caddo-Bossier Parishes Port Commission. “We stand steadfast in our commitment to work side by side with Benteler’s team as they build this world-class facility and provide new jobs and livelihoods for our citizens.”
“We are proud to call Benteler Steel/Tube our area’s newest corporate partner,” said Bossier City Mayor Lorenz Walker. “This is a landmark investment in our economy, the benefits of which will be enjoyed for generations to come not only in terms of good-paying jobs but also with the additional economic development that this state-of-the-art facility will generate for North Louisiana.”
“The addition of Benteler Steel is further proof of the economic growth, potential and strength that exists in this part of the state,” Shreveport Mayor Cedric Glover said. “I’m just thrilled to have this outstanding company setting up shop here and I’m equally thrilled about the thousands of new jobs that Benteler is bringing to Northwest Louisiana.”
“Today’s groundbreaking ceremony for Benteler Steel/Tube marks a historic occasion for our community,” said President Scott Martinez of the North Louisiana Economic Partnership. “This project not only represents one of the largest capital investments in North Louisiana’s history but also signals a shift in how we recruit companies to our region. I’m very proud of the teamwork by state, regional and local partners which brought Benteler Steel/Tube to North Louisiana.”