China Energy plans to invest $83B in W.Va.
PARKERSBURG – Lindsey Piersol at the Wood County Economic Development Office did a happy dance when she learned of the $83.7 billion development deal with a Chinese firm announced Thursday morning by the state Department of Commerce.
Greg Kozera of Shale Crescent USA would have done a happy dance, too, but he was getting a haircut.
“My barber would have had a fit had I done that,” he said.
Their exuberance is over the announcement that China Energy Investment Corp. Ltd. plans to invest $83.7 billion in shale gas development and chemical manufacturing projects in West Virginia.
The signing of the Memorandum of Understanding by West Virginia Commerce Secretary H. Wood Thrasher and China Energy President Ling Wen was witnessed by President Trump and Chinese President Xi Jinping. Trump is in China on a trade mission.
China Energy was created by the merger of the Shenhua Group, a state-owned coal mining company in China, and Guodian Group, which produces energy. China Energy has become the world’s largest power company with more than 200,000 employees.
The China Energy investment in West Virginia was the largest among projects in U.S. corporations and other states that totaled $250 billion, the announcement said.
Planning is underway and will proceed over a 20-year period, the release said. The focus of the projects will be power generation, chemical manufacturing and underground storage of natural gas liquids and derivatives.
Wood County and other West Virginia border counties which have access to rail, highway and river transportation would be at an advantage, Piersol said. The next step is to be prepared with the state and have an inventory of available sites ready, she said.
“I think that they would definitely want us to be prepared with the sites,” she said.
The news is a game changer for the region and the state of West Virginia, particularly if the company plans to invest in new storage facilities and pipelines to move natural gas to markets and companies, Kozera said.
“It’s huge,” he said. “It’s absolutely huge.”
The nation’s cheapest natural gas costs are in the region, a reason for companies to locate here, Kozera said. A scenario is numerous producers supply a storage hub and a company purchases its gas from the hub, he said.
“It would be just like going to the grocery store,” Kozera said.
A question, according to Wood County Commission President Blair Couch, is what is the intent of the company, including will it ship the natural gas to China.
“Specifically, what does the (agreement) mean,” he said.
It’s a massive commitment of resources into West Virginia that would bring thousands of construction jobs and maybe 1,000 or more permanent jobs, said Keith Burdette, president and CEO of the Polymer Alliance Zone that represents Wood, Jackson, Pleasants, Tyler and Mason counties.
“The magnitude of this announcement, it can’t be lost. China Energy’s thought for the future, the confidence they have in the ability for West Virginia to produce and deliver, we have to hold on to that. This means real jobs and real investment for West Virginia,” Burdette said. “I can’t think of any better example about what we have been saying about the development of shale gas.”