Commentary
Thursday August 11, 2011

But Pennsylvania, Ohio are competing

The efforts by many West Virginia public officials and private-sector representatives to lure an ethane cracker to our state are exciting, appreciated, and could result in a game-changing scenario for West Virginia's economy and our state's plastic industry.

The cost of constructing such a facility is around $1.5 billion, and such a project can take four to five years to build. 

The case for locating a cracker in West Virginia is strong.

We have the feedstock product in the vast reserves of Marcellus gas. We have viable sites across the state offering the needed infrastructure.

And we are  situated in close proximity to the major northeast markets for ethylene.

According to the American Chemical Council, a 25 percent increase in the supply of ethane - the predicted growth in supply given the Marcellus Shale boom - could result in 17,000 new chemical industry jobs, 395,000 jobs outside the chemical industry, $16 billion in chemical industry capital investment and $4 billion in federal, state and local tax revenue.

If West Virginia can capture even a small portion of that economic impact, the benefits could be staggering.

As president of the West Virginia Polymer Alliance Zone, which works to market the plastics industry in West Virginia and recruit plastics-related companies, I see the potential for exponential growth in the plastics industry in our region should this come to fruition.

Ethylene is the largest thermoplastic in the world today and necessary for the production of most every plastic product we use. From packaging, clothing, and pipe to tubing, medical products, automobiles and milk jugs, the uses for ethylene and its derivative products are ubiquitous. 

Given the cost benefits of locating a facility near the source of your 7feedstock is certainly an incentive that plastics-related companies would consider in their growth or expansion plans.

If major producers move to our region to take advantage of lower-cost ethylene, smaller vendors and service companies would likely establish operations here as well. 

This would have a transformative effect on our economy, offering good-paying jobs for state residents, and increasing the state's role as a hub in the global plastics industry.

However, we face an uphill battle to lure a cracker to West Virginia. Pennsylvania and Ohio are competing aggressively.

My hopes are buoyed, though, by the good financial shape of our state, the leadership of Gov. Tomblin in executing emergency rules to bring stability to natural gas regulations, and our positive attributes of location, infrastructure and workforce.

We certainly have a good chance. 

The establishment of an ethane cracker would only heighten the potential for a revival of the strong chemical industry for which West Virginia has been known. The spin-off advantages, like growth in what is an already vibrant plastics industry, are tremendous.

Let's hope West Virginia is able to participate in this exciting opportunity.

Facemyer, a state senator from Jackson County, is president of the West Virginia Polymer Alliance Zone.