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Billions in New Investments Would Create 35,000 Louisiana Jobs

NEW ORLEANS ( October 20, 2011) - Abundant and affordable supplies of shale gas could produce more than 35,000 permanent, high-paying manufacturing jobs in Louisiana, reinvigorating the state's industrial base, boosting exports and sparking economic growth, according to an American Chemistry Council  report that ACC President and CEO Cal Dooley released today.

"Access to untapped supplies of natural gas is one of the most important domestic energy developments in 50 years. One-third of U.S natural gas reserves are comprised of shale gas reserves almost impossible to extract just five years ago," Dooley stated. "Shale gas promises an industrial renaissance, here in Louisiana and in America," Dooley said.

The domestic chemical industry relies on natural gas not only to produce heat and power, but also as its primary feedstock, or raw material, needed to create products that go into thousands of items Americans use every day. As the second largest chemical producing state, with 23,000 chemical industry employees, Louisiana is well-positioned to take advantage of the lower feedstock costs that arise from new supplies of domestic natural gas. Abundant shale gas supplies could result in $5.4 billion in new investments in Louisiana, including expansions of existing petrochemical plants and re-starting idled facilities. In addition to creating 35,000 jobs, these investments would generate $19.2 billion in chemical industry output, $2.3 billion in Louisiana wages and $399 million in state tax revenues.  

Dooley released the report after touring a Transportation Consultants, Inc. (TCI) warehouse involved in the packaging and transport of polyvinyl chloride (PVC) plastic and other resins. TCI recently signed a 15-year lease agreement with the Port of New Orleans, an expansion of operations expected to create 20 direct jobs and 300 indirect industry-related jobs.  

Thanks in part to reasonably-priced natural gas, chemical exports at the Port of New Orleans increased 34 percent last year. Nationwide, U.S. exports of PVC plastic have tripled since 2006. More than 20 percent of plastics output was exported last year, double the level recorded before the recession. In 2010, U.S. chemical exports increased 15 percent, turning the balance of trade from a $140 million deficit two years ago into a $4.6 billion surplus.

Growth in chemical industry exports, investment and jobs, thanks to shale gas, is in sharp contrast to the business environment the chemical industry faced just six years ago. Between 1999 and 2005, U.S. natural gas prices quadrupled, and U.S. manufacturers shed more than 5.5 million jobs. More than 140,000 of those jobs were in the domestic chemical industry.

The discovery of shale gas supplies reversed this downward trend and is encouraging U.S. petrochemical investment and growth. As new supplies of shale gas surged, natural gas prices dropped by half from 2005-2009, and manufacturers benefited enormously. "The availability of abundant, low-cost natural gas is helping to revitalize several industries, including petrochemicals, leading to several billions of dollars of new investment in domestic industrial operations that would not have been anticipated half a decade ago," the National Petroleum Council stated in a September 15 report.

ACC's national report released earlier this year attests to the benefits of shale gas for domestic chemistry and the broader U.S. manufacturing sector. It found that a reasonable 25 percent increase in shale gas production would result in nearly 400,000 new jobs in the chemical sector and supplier industries, more than $132 billion in U.S. economic output and nearly $4.4 billion in federal, state and local tax revenue annually. 

Dooley also emphasized that the full potential of shale gas will only be realized with sound regulatory policies that allow robust production in an environmentally responsible manner.

ACC's shale gas economic impact analysis for Louisiana is available at

Learn more about shale gas .


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