Dow Chemical Company is building a multibillion-dollar plant to convert natural gas into the building blocks of plastic – in Texas.
Royal Dutch Shell has chosen a site to build a facility that will convert natural gas into ethylene and polyethylene – in Pennsylvania.
Nucor Steel is building a $750 million plant that will use natural gas, instead of coal – in Louisiana.
Rentech Nitrogen plans to expand its facility – in Illinois.
New York is three governors and four years past the discovery of using hydraulic fracturing to extract natural gas from the Marcellus Shale play, and still no closer to beginning than we were four years ago.
Logically, the recent decision to restart the regulatory review process has been met with intense frustration by those in the Southern Tier who are ready to reap the job creation benefits that drilling will bring. On a larger scale, however, this continued delay will significantly hamper New York’s ability to attract new manufacturing investments and stymie economic rebounds in one of our most important sectors.
The examples above represent a number of opportunities to bring large scale manufacturing operations back to the United States, and New York is missing out. A 2011 Pricewaterhouse Coopers study stated that the downward effect of abundant and low gas prices is a goldmine for manufacturing. The study adds that manufacturers could be saving more than $11 billion a year on natural gas expenses by manufacturing in the United States. The glut of domestic natural gas erases the competitive advantage of moving operations overseas.
Another study done by the American Chemistry Council (January 2012) looked at the projected supply response among eight gas-intensive manufacturing industries. Based on natural gas supply and pricing, the study found “an increased output of $120 billion which would support the creation of more than one million direct, indirect and induced jobs.” Jobs that will go everywhere but New York.
Natural gas development can lead to a significant wave of “re-shoring” of jobs here in the U.S. Continued delay will keep those jobs out of New York. It is time to move New York forward.