WV announces $83.7 billion shale gas, chemical deal with China Energy

By MAX GARLAND

Charleston Gazette-Mail

CHARLESTON, W.Va. — West Virginia will see $83.7 billion in investment from a China-owned energy company for shale gas and chemical manufacturing projects in the state over the course of 20 years, the state Department of Commerce announced Thursday morning.

Gov. Jim Justice called the deal “the largest investment in our state’s history” in a news release, and the deal is the largest of several agreements China made with the United States totaling $250 billion, the release said.

The projects will focus on power generation, chemical manufacturing and underground storage of natural gas liquids and derivatives, the release said.
The memorandum of understanding, or an agreement to do business, is “the first step in a series of commitments” between the state and the company, the release said. It was signed by Secretary of Commerce Woody Thrasher and China Energy President Ling Wen on Thursday, the release said.

The release said China Energy selected West Virginia partly because it features one of the largest known shale gas reserves.

“The massive size of this energy undertaking and level of collaboration between our two countries is unprecedented,” Thrasher said in the release.

China Energy formed through a merger between the China-owned coal mining company Shenhua Group and energy company Guodian Group, the release said, adding that China Energy is now the world’s largest power company with more than 200,000 employees.

West Virginia University has been jointly researching coal liquefaction with mining company Shenhua Group, which merged with Guodian Group to form China Energy.

In its own news release, WVU said it will be working closely with the state to coordinate the investment. Funding from the deal will primarily focus on the development of an “Appalachian Storage and Trading Hub.”

WVU’s release added that investments will also go toward infrastructure including electricity from natural gas plants, chemical and polymer manufacturing and high-end chemicals.

State officials including Thrasher have long touted the potential of a natural gas storage hub in the state. In a September speech at The Greenbrier, Thrasher cited a study by the WVU Energy Institute that three of five plausible hub locations identified are in West Virginia. Several energy companies contributed funding for the study.

This story will be updated with more information.

Reach Max Garland at [email protected], 304-348-4886 or follow @MaxGarlandTypes on Twitter.

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