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Energy officials react to the W.Va., China Energy $83 billion energy agreement


The Exponent Telegram

CLARKSBURG, W.Va.  — State officials and companies are looking to the future after an announcement by the West Virginia Department of Commerce about China Energy Investment Corporation Limited’s plan to invest $83.7 billion in shale gas development and chemical manufacturing projects in the state.

West Virginia Secretary of Commerce Woody Thrasher and China Energy President Lin Wen signed a memorandum of understanding between the company and the state as part of a U.S.-China Business Exchange trade mission to enhance relations between countries.

President Donald Trump and Chinese President Xi Jinping witnessed the signing.

Marc Monteleone, president of the West Virginia Independent Oil and Gas Association, said the pledged investment represents hope for the future of West Virginia and shows the confidence that China Energy has in the Mountain State.
Marc A. Monteleone

“This means more investments in gas-fired power plants, the storage hub and key infrastructure that is essential to the proper development of natural resources,” Monteleone said. “The most exciting part is the simple fact that West Virginia has been recognized as the place to make the investment.”

The $83 billion investment is one of the largest of its kind in the region and by far the largest in the state, Monteleone said.

The Appalachian Storage Hub alone represents nearly 100,000 jobs, so the accord means a “very bright future” for young people and a possible end to migration of the best talent to other states, he said.

“It’s too early to tell just how many opportunities this represents, but each will be substantial,” Monteleone said. “Our state leaders have been very involved in this deal, and each did an outstanding job landing this opportunity for our nation, region and state.”

Anne Blankenship, executive director of the West Virginia Oil & Natural Gas Association, said the association is thrilled to learn about the investment.

Anne Blankenship

“The investment will support the growth and development of natural gas end uses for which we have been advocating for many years,” she said. “Natural-gas-powered electric generation facilities, natural gas liquid storage and the petrochemical manufacturing industry have all been part of our policy initiatives, and we are excited to hear that a huge investment is planned to further those developments.”

With the creation of additional uses for the enormous amount of natural gas West Virginia has to offer, as well as the use of that resources here, the state will see its gas industry, manufacturing industry and tax revenues grow, she said.

“West Virginia is primed for this development. We have one of the largest natural gas fields in the world, a strong workforce, proximity to a large portion of the nation’s population and a rich history in manufacturing,” she said. “We are ready.”

As far as natural gas, West Virginia is seen as the Saudi Arabia of North America, according to Bob Orndorff, West Virginia state policy director for Dominion Energy. While the state is flush with coal, natural gas and natural gas liquids, this deal will attract national and international businesses.

“This is a break for the industry. We need to develop natural gas storage, natural gas liquid storage, and the influx of money associated with the trade agreement will really spur the storage development, petrochemical industry tremendously and create a reason to use those natural gas liquids we are currently exporting and use them in the state,” he said.

The China deal bolsters the Dominion pipeline projects, he said. The value of natural gas liquids in the state is minimal now, but the deal will create an opportunity for those liquids to be traded and used here.

“The bottom line is West Virginia is poised to truly capture the international market, and this is the first of many that will come along,” he said. “The fact that we have a local person, Secretary Woody Thrasher, being part of the deal broker bodes us well in Harrison County.”

Orndorff said the deal will help future generations of West Virginians find high-paying jobs in the Mountain State.

Antero Resources is also excited for the prospect of investment in West Virginia that would positively impact the natural gas industry, petrochemical industry and electricity generation, said Kevin Ellis, vice president of government relations.

“Equally important is the prospect of job creation for local businesses and workers in West Virginia,” he said. “As the largest producer of natural gas in West Virginia and largest producer of natural gas liquids in the U.S. as of the third quarter, we welcome new opportunities to introduce our products into commerce in West Virginia.”

Ellis said Antero recognizes that greater demand locally will have a beneficial impact on all stakeholders in the industry.

“We would like to congratulate Governor Justice and Secretary Thrasher for their focus and success in bringing new investment into West Virginia that will further capitalize on the abundant natural gas and natural gas liquid resources in the state,” Ellis said. “We are also confident in the leadership of Governor Justice and Secretary Thrasher in attracting business investments that will lift the economic potential of the state and offer important opportunities for West Virginia companies and employees.”

U.S. Rep. David McKinley, R-W.Va., said the China deal will amount to the largest investment in the state to date. It has the potential to create thousands of jobs and speed the development of the petrochemical and plastics industry here. Natural gas liquid storage is important because the petrochemical and plastics industry depend on it to operate.

“This investment in shale gas resources located here in West Virginia will spur tremendous economic growth in our communities. Secretary Thrasher has been in constant contact with my office as his team has worked out the details for this project,” McKinley said. “We commend him for his dedication to bringing new jobs to the Mountain State, and we look forward to the opportunities created by this new partnership.”

McKinley’s communications director said McKinley has been pushing the issue in Congress.

“The congressman feels very optimistic about West Virginia’s future,” Alec Thomas said. “There’s still work to be done, but things are starting to turn around. Our economy is diversifying; our unemployment rate is dropping; and our economy is growing at the second fastest rate in the nation. There is much to be hopeful about in the Mountain State.”

Sen. Shelley Moore Capito, R-W.Va., said the China deal is going to allow the state to move forward. The Appalachian Storage Hubs is a project she’s been working on with others, and this will bring it to a reality.

“I am very excited about this. The Development Office and Secretary Thrasher have done a wonderful job,” she said. “One question that keeps coming up is if it’s actually going to happen. I think we have to realize this was signed in front of the president and the president of China — that means the possibility and good things will result from this.”

Capito said the deal will unleash the power of the state’s energy reserves to create jobs.People should expect to see growth in NCWV.

“I can’t overstate the terrific impact this will have in terms of jobs, wages and opportunities,” she said. “The most exciting part of this is that it’s going to enable us to keep the resources in and around the region, whether it’s chemical, plastics or power generation, and to create more jobs.”

“I am thrilled Secretary Thrasher and China Energy have signed the memorandum of understanding in Beijing. I have always said West Virginians are the hardest working people in the world. I’m glad China Energy recognizes this and is working with us to create jobs and economic growth in our state,” Sen. Joe Manchin, D-W.Va., said.

Staff writer Victoria L. Cann can be reached at (304) 626-1409 or [email protected]. Follow me on Twitter @vcann_theet

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