COMMUNITY PROFILE: Opportunity Knocks in Southwest Louisiana
By Eric Cormier
From the September/October 2013 issue
Opportunity is a word used a lot when discussions about Southwest Louisiana are started.
Bordered by the Gulf of Mexico to the south and Texas to the west, the sky is literally the limit for an area where an estimated $48 billion in private investments already have been announced, including several mega-projects in the natural gas industry. Recent job-creating developments in the region—which includes Allen, Beauregard, Calcasieu, Cameron and Jefferson Davis parishes (counties)—will create more than 40,000 jobs in the coming years.
George Swift, president and CEO of the Southwest Louisiana Economic Development Alliance, asserts that prospects are great for any business that locates or expands in the area.
“We have plenty of opportunity here. There are good sites to develop because of our infrastructure which includes six ports, interstate highway, railway, airports, a large pipeline system, a loyal and productive workforce, and training facilities,” Swift says.
Southwest Louisiana (SWLA) is home to the most impressive network of pipelines in the U.S.: hundreds of miles of pipe used to move crude oil and chemicals inside and outside the area. In an interview with a Lake Charles newspaper, Chris John, president of the Louisiana Mid-Continent Oil and Gas Association said this “second to none” infrastructure has made SWLA a magnet from some of the biggest energy-related projects in the nation.
“I can’t imagine projects like Sasol and Cheniere would exist without the kind of pipeline infrastructure that we have today. We are blessed to have natural resources like oil and gas, but you have to be able to transport them and that adds value,” he told the American Press.
Sasol North America plans to invest up to $21 billion on a gas-to-liquid and ethylene cracker/derivatives unit in Lake Charles, one of the largest foreign investment projects in American history. Cheniere Energy is the first company granted approval by the U.S. government to export natural gas to non-free trade countries. As a result, the company is spending $11 billion to retrofit its facility in Cameron Parish for exporting capabilities.
The region also boasts the nation’s twelfth-largest seaport, the Port of Lake Charles. Its facility includes the City Docks—located 34 miles north of the Gulf of Mexico on the Calcasieu River Ship Channel, which is 40 feet deep and 400 feet wide. Interstate 10 and Interstate 210 are within a few miles of the port. Rail service is provided by Union Pacific, Burlington Northern, Santa Fe and Kansas City Southern.
All of those assets, combined with the huge investments already being made here, announce to the world that Southwest Louisiana is a thriving location that will meet the needs of any growing industry.
PROPERTY IS PLENTIFUL IN SWLA
Swift notes that available commercial, residential and industrial land in the five-parish area is plentiful.
In an effort to expedite the needs of investors and companies searching for property to build office space, production facilities and warehouses, Entergy Corporation developed the Louisiana Site Selection Center. The Center allows users to survey potential business sites all over the state. Currently, the Center’s website displays 142 Louisiana Economic Development (LED) certified sites and a total of 16,531 acres of property available in the five-parish SWLA area [this does not include other available property which can be viewed with assistance from real estate professionals].
According to LED’s website, a certified site “is a development-ready industrial site that has completed a rigorous review process by Louisiana Economic Development and URS, an independent, third-party engineering firm. Specific site details, such as zoning restrictions, title work, environmental studies, soil analysis and surveys, are assessed for compliance and authenticity.”
In addition to the cornucopia of available sites, business representatives will be impressed by the helpfulness and hospitality bestowed on them by leaders in Southwest Louisiana. Nurturing relationships is important to governmental and economic development representatives in the region because diversification of the economy is one of the primary goals of those overseeing its growth.
“It is important to diversify the economy—all kinds of workers can be employed in our area. Already, we have a very varied market with the petro-chemical sector, hospitality and gambling, timber, agriculture, maritime, health care and aviation industries,” Swift said.
Sites certified by the LED include:
- In Allen Parish: the Allen Parish Airport, Allen Parish Business and Industrial park and East Industrial Park provide a combined 202 acres of land for development.
- In Beauregard Parish: the Beauregard Parish Airport and Industrial Park, Beauregard Regional Airport, Jim West complexes provide a total of 5,000 acres for development
- In Calcasieu Parish: the Lake Charles Harbor and Terminal District, West Calcasieu Port and DeQuincy Industrial Park are just a few of 115 sites with a total of 10,000 acres for development.
- In Cameron Parish: the West and East Cameron Ports are where some of the areas 500 acres are open for review.
- In Jeff Davis Parish: the Mermentau River Harbor and Terminal District and Laccassine Industrial Park have 916 acres of available land.
LOTS OF ASSISTANCE IS AVAILABLE
Sasol’s project is a perfect example of how relationships are fostered in Southwest Louisiana. In 2010, the company announced intentions to build the world’s first ethylene tetramerization unit next to the company’s Westlake complex in Calcasieu Parish. The Alliance, Port of Lake Charles and LED’s Business Expansion and Retention Group joined together in 2011 to find property for the project.
Site information was compiled and applied to a Geographic Information System (GIS) which mapped property in order for site-suitability studies to be conducted. That process led to 650 acres of land that would meet Sasol’s needs.
“The old way of selecting a site for a major plant was to send a guy out in a pickup truck with a dumpy level and to survey what was going on. The GIS technology has enabled us to short-circuit that approach and come up with a good site that will meet all of our requirements in a time space that is six to 12 months shorter than the traditional approach would have been,” said Andre de Ruyter, Sasol’s North American president.
Once the company decided it would build in Southwest Louisiana, the next step was to make sure the workforce—which already is skilled—was ready to provide construction and technical knowhow to the project.
McNeese State University and Sowela Technical Community College stepped up to adjust its curricula to meet Sasol’s needs. McNeese State, located in Lake Charles, is the region’s largest educational provider and graduates a large segment of the area’s engineers and other technical support employees.
Opened in 1939, the school serves 8,700 students and provides degrees and graduate studies in a wide range of subjects, including business, education, nursing, liberal arts, engineering and engineering technology.
Dr. Philip Williams, the university’s president, stresses that graduates are prepared to work and make meaningful contributions that are desired in today’s global economy.
“Producing graduates who have achieved mastery in a particular content area is crucial, but we want to teach them new ways to approach that major. For example a chemistry major would have the tools to become an innovate chemist. The minor requires coursework in creativity science, communication skills and commercialization, which means learning how to develop a raw idea into one that can be commercially viable,” he said.
Sowela—also located in Lake Charles—began classes in 1940. Students walk away from the school with diplomas or certificates in automotive technology, aviation maintenance technology, collision-repair technology, drafting and design technology, office systems technology and process technology, among other fields of study.
“Sowela is a comprehensive technical community college serving the Southwest Louisiana region in preparing students for employment,” said Dr. Neil Aspinwall, the school’s chancellor. “Sowela also offers non-credit workforce training and business support by partnering with businesses in designing and delivering customized, short-tern industry based training.”
The school is in the midst of constructing a $20-million workforce training center, sponsored by Sasol North America.
“Many of our programs are industry-specific and we work closely with business and industry to design curricula that fits industry requirements,” Aspinwall explained. “[For students] seeking the training necessary to become skilled employees in the marketplace, Sowela is uniquely positioned to meet those needs.”
A BOUNTY OF INCENTIVES
Local and state tax incentives are another enticement provided to potential developers in SWLA. Available incentives include the Enterprise Zone Tax credit program that provides a one-time $2,500 tax credit per certified net new job and a Quality Jobs Cash rebate providing a rebate of up to six percent on annual payroll expenses for up to 10 years. Other incentives include the Restoration Tax Abatement Property Tax Abatement; Industrial Tax Exemption Property Tax Abatement; Sound Recording Investor Tax Credit;, Research and Development Tax Credit; and Digital Media, Motion Picture and/or Live Performance tax credits.
Louisiana’s top-rated FastStart workforce training program provides workforce recruitment, screening and training to new and expanding Louisiana companies at no cost, with a focus on manufacturing, digital media, corporate headquarters, warehouse and distribution, research and development and other projects which commit to creating at least 15 jobs (service providers must commit to creating 50 jobs). A Technology Commercialization Credit and Modernization Tax Credit also are available.
Small businesses that apply and qualify may be able to benefit from small business loan programs, micro-loans, bonding assistance programs, veteran initiatives and mentor-protégé programs.
In August 2013, the Southwest Louisiana Entrepreneurial and Economic Development Center at McNeese State (SEED Center/Business Incubator) opened its doors.
Inside the facility, businesses will find the Alliance; Imperial Calcasieu Regional Planning and Development Commission; SEED Center Business Incubator and Entrepreneurial Center; Service Corps of Retired Executives; Louisiana Procurement Technical Assistance Center; Louisiana Small Business Development Center at McNeese State; Institute for Industry/Education Collaboration; McNeese State Student Innovation Center and Business Incubation Studio; McNeese State Student Innovation Center and Business Incubation Studio; and McNeese States’ Office of Research and Sponsored Programs.
Williams notes that McNeese State’s involvement in the SEED Center encourages collaborations between business and the public sector.
“Locating the SEED Center on the campus puts McNeese at the focal point of economic development and entrepreneurial activities for the region. Collaboration between business and academia is the way Silicon Valley started,” he said.
Business and industry representatives can walk into the region knowing that plans are being made to address growth that’s already occurring, thereby making sure the doors of opportunity will remain open. One way local leaders are preparing for the “boom economy” is through short- and long-range planning.
The Go Group was commissioned by leaders in Calcasieu Parish to devise plans that would help direct local, state and federal financing for infrastructure, educational and workforce needs. Residents and officials from the region’s governmental, private and educational sectors are participating in numerous committees set up by the Group.
Grant Bush, executive director of IMCAL, said transportation is one of the primary topics discussed among Go Group participants. “Transportation issues aren’t fixed overnight,” he notes. “We are developing a plan that prioritizes short-term and long-term projects for financing to make sure the quality of our roadways are excellent and able to meet the needs of citizens and industry.”
EXPONENTIAL GROWTH IN SWLA
To say Southwest Louisiana is an economic hot zone would be an understatement. Each of the five parishes is seeing economic growth that is breaking monetary records from previous years.
In Allen Parish, Virtual Engineering Operations is expanding operations with a $100-million investment with permanent jobs averaging $100,000 per year. Coushatta Casino Resort built a $600-million hotel, creating 150 new jobs.
In Beauregard Parish, Boise Inc. is undertaking a $111-million expansion and in Cameron Parish, Cheniere Energy is in the midst of an $11 billion investment creating 283 new jobs. Sempra/Cameron LNG is investing $6 billion on a facility that will create 130 new jobs. Jefferson Davis Parish is where BP Biofuels invested $400 million in a new facility.
Calcasieu Parish is experiencing the brunt of the growth. In addition to the mammoth Sasol project, Chicago Bridge and Iron has opened a new $100-million facility. Energy Transfer Equity/Trunkline LNG is in the midst of a $5.7 billion investment that will create 100 new jobs and 3,000 construction jobs. G2X Energy is moving ahead with a $1.3 billion natural gas complex that will create 243 new jobs and 748 indirect jobs. Lakes at Morganfield announced a $350 million residential and mixed-use development that will result in 1,000 homes retail business space. Leucadia National Corporation/Lake Charles Cogeneration is building a $2.6-billion energy complex, and Magnolia LNG is also moving forward with a $2.2-billion plant.