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Why is Ohio snatching W.Va. cracker plant hopes?

FLY, Ohio — The buzz at the local tire/convenience store here is about the $1.3 billion baby cracker plant possibly headed for construction in nearby Clarington, a project once envisioned for West Virginia.

“Your loss,” said Ed Hill, sipping a diet Dr Pepper. “We need those jobs just as bad as West Virginia does.”

Last August, Houston-based Appalachian Resins Inc. signed a letter of intent to lease 50 acres from the Monroe County (Ohio) Port Authority, where the company may construct a cracker plant that could create up to 200 full-time jobs when production starts sometime in late 2018 or early 2019.

North on Ohio 7 is Shadyside, where rumors at the Tiger Pub, the local drinking establishment, are that the village could possibly be the site of the multibillion-dollar cracker plant expect to come to Belmont County, developed by PTT Global Chemical of Thailand and Marubeni Corp. of Japan. This was another plant West Virginia was in the running for but was eliminated early in the process.

Shadyside, where teens still cruise “The Loop” on weekend nights, has a high school, a couple stores and high unemployment.

At the Tiger Pub recently, patrons spoke of jobs and a community comeback as they nursed $1 draft beers and ate salty pretzels.

“This would not only help Shadyside; this would help the entire area,” Shirley Roby said of the project, which could bring several hundred permanent jobs.

Belmont County officials said a final decision could take a year or more, as PTT and Marubeni must complete engineering designs and obtain state and local permits.

Within the last year more than $3.5 billion worth of projects in the Buckeye state related to the shale oil and gas energy has been announced, Ohio Economic Development officials said. Since 2010, officials said, shale development has spurred more than $22 billion worth of projects and if the state gains the two cracker plants that figure could inch closer to $30 billion.

Two weeks ago it was announced the much-hyped planned natural-gas complex in Wood County would be placed on hold until further notice.

The two Brazilian companies that had planned on the Wood County site said in a press release the project is on hold because “under current energy scenarios” more analysis is needed.

The project, known as ASCENT, was dubbed a “game changer” by Gov. Earl Ray Tomblin that would ignite economic development to make up for the drastic decline in coal jobs.

In a statement to The Wall Street Journal, Tomblin’s spokesman said, “With investment of this magnitude and the changes in the worldwide energy markets, re-evaluating the best configuration for the project is understandable and consistent with the company’s overall approach.”

Nationwide, at least five projects are under construction and approximately 10 are proposed, according to trade publication NGI. In late April, Ohio officials received confirmation from Appalachian Resin Inc. that it wants to go ahead with construction of its facility in Monroe County, Ohio.

Why is West Virginia losing out to Ohio?

After all, the state has passed aggressive legislation to attract world-scale ethane crackers and related facilities, or so says the Commerce Department’s Development Office.

That bill, the Marcellus Gas Manufacturing and Development Act, is extremely business-friendly. It clarified ethane cracker facilities as a manufacturer, which allows the companies to qualify for Economic Opportunity Credit and Manufacturers Investment Credits, according to the state’s Development Office.

It also amends the strategic research and development tax credit to include design, refinement and testing of equipment as being eligible for research and development investments. In addition, the bill includes any component of raw natural gas as an alternative energy resource under the Alternative and Renewable Energy Portfolio Standard.

Another provision of the bill allows qualified additional capital to be valued at salvage value, meaning it eliminates 95 percent of property tax, according to the state’s Development Office.

E-mails to West Virginia’s oil and natural gas trade groups asking why the state is losing out to Ohio went unanswered last week.

Ohio officials declined to give particulars on tax breaks and other incentives to entice cracker plants to locate within its borders.

Steve Roberts, president of the West Virginia Chamber of Commerce, said state officials can offer all the tax breaks they want, but if economic and business policies do not change, West Virginia will continue to lose not just cracker plants…

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