Pipeline infrastructure huge asset for Southwest Louisiana

05 14, 2013 by American Press

The commercial pipeline infrastructure that was built in Southwest Louisiana is a prime asset that should continue to help the region to grow economically, according to the president of the Louisiana Mid-Continent Oil and Gas Association.

Overall, Louisiana has about 125,000 miles (87,764 onshore and 37,000 offshore) of pipes that transport oil, gas and chemicals.

Chris John, who heads the association, said large energy companies around the world are aware of low cost natural gas in America and the ease in which products and by-products can be transported to industrial facilities in Calcasieu and Cameron parishes because of pipelines.

“I can’t imagine projects like Sasol and Cheniere would exist without the kind of pipeline infrastructure that we have today,” John told the American Press. “We are blessed to have natural resources like oil and gas. But you have to be able to transport them and that adds value.”

The Gulf Coast has over 500,000 miles of pipeline stretching from the tip of Texas to Alabama.

“Nowhere does that exist,” John said. “And that is why you see these new investments and multibillion dollar project announcements.”

Company officials with Magnolia LNG were impressed with the pipeline system that exists in the local area and that factored into their decision to build a facility on property owned by the Port of Lake Charles.

Industry experts agree that not many areas around the world provide the piping — coupled with a pro-industry business climate — that is necessary for energy companies to make financial investments into new projects.

The Louisiana Tax Commission announced in a 2011 report that the Louisiana pipeline system has a value of $1.9 billion.

Louisiana economist Loren Scott found that the industry has 2,611 people working with a yearly payroll of $203 million.

According to John the industry has two challenges.

“Mother Nature is a huge issue with pipelines due to hurricanes and erosion. A lot of companies invest in rebuilding the coast because their investment is found there,” he said. “Then there are permitting issues from the environmental standpoint but that’s normally with the federal government.”

He believes Louisiana has done “a good job” of regulating the industry.

John says the Lake Charles area is a big winner in the international energy sector.

“It is the location of choice for a lot of facilities. Why come here? It is not because of they love mosquitoes and hot weather,” he said. “There is cheap natural gas in our country and the Lake Area has the infrastructure to get it there. People need to be thankful that the infrastructure was built and the economy is benefiting.”