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One of my concerns on our U.S. Commercial Services Roadshow trip to Turkey earlier this year was language. I do not know any Turkish.
In Istanbul and Ankara, the presentations were in English or they had a headset with a translator. In Koceali, our second stop, everything except our afternoon presentations were in Turkish with no translator. I had no idea what they were saying.
When the third panel started, I sat next to a young woman who whispered to me, translating what the panelists said. I learned valuable information. At one point, the woman whispered, "He just told companies coming to the USA to find a site with a building on it first because they take so long to build in the USA."
I looked at her in astonishment. "That is exactly the wrong thing companies should do. Thank you for letting me know. We will make sure companies we talk to today and tomorrow in Ankara know the right thing to do and why."
In Turkey and many other countries, building infrastructure like pipelines and power lines is easy. They don't have the regulations the USA has. Turkey built a natural gas pipeline across their country in just over two years. It took over eight years, an act of Congress and a Supreme Court decision to get the Mountain Valley Pipeline built. It covers a much shorter distance, from central West Virginia to southeast Virginia, where many industrial customers including a U.S. Naval base were getting curtailed during weather extremes.
In January, for nine days when it was extremely cold and everything was covered with inches of ice, wind and solar contributed no electricity to the PJM grid. Natural gas kept the lights and heat on thanks to the Mountain Valley Pipeline. Lynnda and I were in Richmond for a meeting in January. The city looked like a scene from the Disney movie "Frozen."
In some countries, if the supreme leader wants a pipeline, they build a pipeline. The USA must do better permitting infrastructure projects. The current system is costly to companies and taxpayers.
The other issue in the USA with infrastructure is cost. If a site needs water, sewer, natural gas, electricity, broadband or a road, it comes at a significant cost. The greater the distance to the site, the higher the expense.
Solutions to infrastructure issues for companies looking to bring manufacturing and high-wage jobs to the USA can be solved by the site they choose. In the USA, buildings are quicker to build than infrastructure. Shale Crescent USA tells companies, "Locate the infrastructure you need most first." If a company is going to be a high electricity or natural gas user, find where the resources are located, then look for sites in that area. Sites can be modified cheaper than the expense of extending electricity in most cases.
For years, the Shale Crescent USA region was at a disadvantage to places like the Carolinas and other states having more flat land. The world has changed. Energy cost and availability is the major factor for attracting manufacturing and jobs. Most foreign companies have no idea where energy resources are in the USA. They think all the oil and gas is in Texas.
SCUSA has more sites that can meet prospects' energy needs than other eastern states. Sites and energy have become our region's superpower for creating high-wage jobs once manufacturers know and understand. Most of the manufacturers SCUSA is working with need less than 50 acres. Pipelines are not as difficult to expand as long as they don't cross a state line. The challenge is most companies don't understand the basics of energy in the USA. Transporting natural gas is not cheap. Cost of transportation can equal the cost of the product. Companies in the SCUSA have a huge permanent competitive advantage.
A large U.S. company is planning to build a natural gas power plant in North Carolina for their data center. North Carolina produces NO natural gas. Natural gas for their power plant must come from the Shale Crescent with a significant transportation cost for the life of their facilities. They plan to get their gas from an expansion of the Mountain Valley pipeline into North Carolina. The antis in Virginia are fighting all pipeline expansion. (The antis can't explain how to keep lights and heat on 24/7 economically without natural gas.) Expansion into North Carolina falls under federal regulation in addition to the states. An opportunity for delays. The solution is to locate where electricity is abundant, and fuel is available and cheap. That is NOT in the Carolinas or most eastern and Midwest states.
Another company looking at sites in Ohio found the perfect building but could not get the local gas utility to expand natural gas to the site promptly. The company found other sites with natural gas but no building on the sites. They chose a site in western Kentucky with little natural gas production and infrastructure. Their natural gas will come from the SCUSA at a much higher price due to transportation, assuming they find a pipeline with capacity. They have a building. Economic incentives will never offset increased energy cost for the life of the plant.
SCUSA is continuing to work with companies who understand the importance of building on top of their energy and feedstock and locating in the center of their customers. Next week we have a company visiting the region to select a site. Lynnda and I get to be their chauffeur and guide. They have meetings with state people and site owners.
Site selection is about location of energy, raw materials and workforce. Our region has an exceptional story to tell. The future is bright if we recognize and use our energy and site superpower.
Companies overseas are recognizing our region's advantage. People in the region should understand the opportunities we have. Smile, we have a bright future. It starts with understanding and belief. Many companies and their leaders don't know what they don't know. We can tell them.
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Greg Kozera, gkozera@shalecrescentusa.com, is director of marketing for Shale Crescent USA. He is a professional engineer with a master's in environmental engineering and more than 40 years of experience in the energy industry. Greg is a leadership expert, high school soccer coach, professional speaker and author of four books and many published articles.