Moret: Natural gas fueling Louisiana's economy

The price of natural gas is perhaps the most important factor driving the state's positive economic outlook, Louisiana Economic Development Secretary Stephen Moret says.

"Low, stable natural gas prices have completely turned around the fortunes of Louisiana's chemical industry," he says.

Moret predicts a "robust, sustained industrial construction boom in south Louisiana" serving the chemical and energy sectors, largely thanks to the fact that the cost of natural gas is expected to remain low for many years.
While the chemical industry isn't expected to create very many new jobs, billions of dollars' worth of capital-intensive projects are expected over the next several years. He says the Baton Rouge area likely will see many expansions and modernizations, along with some relocations. Low natural gas prices also contribute to lower energy costs for businesses and consumers.

LED released its economic highlights report for 2011 today. Moret says the two most significant projects in the Capital Region this year have been in Ascension Parish: the restart of the Ormet alumina facility—a project worth $21 million, 250 direct jobs and about 1,000 indirect jobs; and the reported $100 million investment Trafigura is making in the idled bulk terminal it purchased from Ormet this summer.

He also touts the region's digital media growth, highlighted by the expansion of Electronic Arts' LSU-based North American Test Center to 600 jobs by late 2012.

LED claims a total of "40 major project wins" in 2011, including 24 expansions or retentions and 16 new projects, retaining more than 8,400 jobs and creating 5,600 new ones, with a total of $18 billion in new investment.

Although the state's Revenue Estimating Conference lowered its forecast yesterday, Moret says the new numbers still indicate the state is in economic recovery mode.

The forecasts for fiscal years 2012 and 2013 show an increase of 3.8% for 2012 versus 2011 and an increase of 4.2% for 2013 versus 2012, he says.

The biggest threats to that projected growth, Moret says, are the sluggish national recovery and concerns about federal regulations. But even if there's a double-dip recession, he says, Louisiana could ride it out reasonably well, much as it has the last downturn.

See LED's 2011 report here.