The Coming Boom

The Coming Boom

South Louisiana Could Be Key to Changing World Oil Dependence

by Woody Jenkins, Editor

BATON ROUGE — Revolutionary technology, which allows natural gas to be converted to synthetic gasoline that can be used in any ordinary automobile without a conversion kit, is poised to come to South Louisiana in a big way.  If it does, the future of the state and, for that matter, the world could change for generations.

This technology, combined with Louisiana’s massive reserves of natural gas, could completely end America’s dependence on oil imported from the Middle East, Venezuela, and other OPEC countries.

Although public officials are mum, there is little doubt that a site in St. James Parish is being considered for a massive GTL (gas-to-liquids) plant that would make Louisiana central to how the world gets its energy.

The technology is no theory.  Shell Oil currently operates the Pearl GTL plant in Qatar, and there are four other GTL plants in the world, but none in the United States.

The revolutionary aspect of GTL technology is that the synthetic fuels created can be used in any ordinary gasoline-powered automobile without spending a penny on conversion.  The driver will simply pull in to his regular gas station and fill up his tank.  GTL technology is also used to produce other fuels, such as diesel.

One source said a new GTL facility in St. James Parish could represent an investment of $5 to $10 billion and employ 8,000 full-time employees.

More importantly, a major GTL facility in Louisiana could be the beginning of the end of America’s reliance on foreign oil.  Experts say that within eight to 10 years, GTL technology could make the U.S. completely energy independent.

While GTL technology works, three factors are coming together to make it almost unstoppable — the high price of imported oil, the low price of natural gas, and the unprecedented supply of natural gas in the United States, especially in Louisiana.  The U. S. now has more than a 100-year supply of natural gas, which is likely to keep prices low for the foreseeable future.

Scott Angelle, former Louisiana Secretary of Natural Resources and now a candidate for Public Service Commission, told a crowd of supporters Tuesday that GTL technology becomes practical when the disparity between the price of oil and price of natural gas is at least 15 to 1.  He said it is currently 23 to 1, which makes GTL very cost effective.

In recent months, public officials and economic development spokesmen in Ascension and St. James parishes have said something really big is coming to their area, in addition to the Nucor steel mill, but they have refused to say what it is.

To some degree, the project is hanging on the outcome of the Nov. 6 election, but one contractor who has been approached numerous times by the owner of the project said the election of Republican Mitt Romney will hasten the project but that under Democrat Barack Obama the project could have rough sailing.

Writing in, Scott McKay said, “The word is Shell is going to build a new GTL facility, on par with the size of Pearl, in America so as to take advantage of the more localized demand. And the word is within three to six months, Shell expects to announce a decision on a site somewhere on the Gulf Coast. And Louisiana, with its plentiful supplies of ‘dry gas’ coming out of the Haynesville Shale and its world-class natural gas infrastructure, could very well win out as the domicile for the facility. Within 18 months of the site selection, Shell expects to finalize its construction plans, and it’s expected that four years later a GTL facility which employs some 10,000-12,000 permanent workers will go on line…It will take in some 1.3 billion cubic feet of natural gas per day, and that could be enough to move the price of natural gas upward. Which is good news for landowners in places like the Haynesville Shale, who are disappointed to see wells shut in thanks to the current poor prices for gas.”

If these reports are correct, Louisiana could be the center of a long-running boom — perhaps the greatest in its history.

The owner of a multi-billion-dollar GTL plant will need everything imaginable from skilled employees to suppliers and contractors of every description, thereby creating enormous economic opportunities.

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