Pipelined Progress: Louisiana’s Process Industries

Home to more than 150 petrochemical manufacturers and 18 refineries, Louisiana offers considerable strategic advantages for companies in the process industries. From legacy sectors like chemicals and refining to innovative technologies leveraging low cost feedstock, the state’s abundance of talent, infrastructure and natural resources provide unparalleled opportunities. Globally recognized companies such as Dow, ExxonMobil, Honeywell, BASF and Methanex have established or expanded operations in Louisiana and are benefiting from the state’s unique advantages.

Industrial Talent in Full Supply

A right-to-work state with a rich history in process industries, Louisiana offers an abundance of skilled talent with proven performance in safe, production-oriented work environments.

Louisiana is also making strategic investments in higher education to meet the state’s future workforce needs. Research centers and universities throughout the state fuel innovation, provide skilled workers to companies in process industries and graduate new chemical engineers each semester. Additionally, Louisiana State University (LSU), Louisiana Tech, Southern University, Tulane University and University of Louisiana at Lafayette (UL Lafayette) have specific programs and research strengths related to process industries.

In response to industry requests, the Louisiana Community and Technical College System (LCTCS) standardized a process technology (PTEC) curriculum and expanded it to six schools in the state in support of chemical and refining industries. Representatives from business and industry designed the high-quality curriculum and serve in an advisory capacity to evaluate the program’s success on a regular basis. Now considered a model, the PTEC program has helped process industries in Louisiana avoid pitfalls, such as potential workforce shortages, while attracting a new generation of trained workers.

In conjunction with private sector projects, Louisiana is willing to make additional education and training-related investments to support a company’s goals. As part of Sasol's incentive package, Louisiana will fund a $20 million manufacturing training facility with specialized equipment focused on industrial technology to be built on the campus of the SOWELA Technical Community College in Lake Charles. As part of LCTCS, the facility will be available for other students once company-specific recruitment and training services ramp down — resulting in a net benefit for the company and community.

“This new facility will provide the means to plan, design and deliver the training programs and services to help ensure that our business and industry partners are successful. Projects such as this prove that Louisiana is very proactive, business-friendly and committed to providing for the economic growth and overall well-being of the state as a whole.”

Research and Development Institutions Conduct Groundbreaking Research

Louisiana is nationally ranked in the top tier for its share of research and development funding for biotechnology engineering disciplines. Twenty university-run research stations located throughout the state offer companies groundbreaking research and critical economic resources when it comes to biofuels.

UL Lafayette also regularly conducts bioprocessing research in partnership with private companies and the Louisiana Institute for Biofuels and Bioprocessing. View Chart >

The LSU Agricultural Center offers expertise on biomass feedstock development and conversion technologies, linking the state’s agricultural base with emerging bioenergy initiatives. View Chart >

LED FastStart Delivers Customized Workforce Solutions

LED FastStart®, the nation’s No. 1 state workforce development program, creates customized workforce recruitment, screening and training solutions. FastStart works with eligible new and expanding Louisiana-based operations to ensure that companies have a highly qualified, trained workforce from day one — all at no cost to the company. FastStart has designed and delivered customized workforce solutions for a wide variety of Fortune 500 companies across multiple industry sectors. In particular, the team has managed hundreds of workforce programs in multiple states for leading companies like CF Industries, Myriant Technologies, Methanex, SNF and many others.

Business Incentives Designed to Manufacture Success

Louisiana’s highly competitive incentives offer both new and existing process industry operations significant advantages. Louisiana’s wide selection of programs can be combined to create robust, flexible, customized incentives packages for companies. In particular:

• Louisiana offers the Industrial Tax Exemption Program, which provides property tax abatement for up to ten years on a manufacturer’s new investment and annual capitalized addition.
• The Quality Jobs program provides up to a 6 percent cash rebate of annual gross payroll for new, direct jobs for up to 10 years. It could also provide a state sales/use rebate on capital expenditures or a 1.5 percent project facility expense rebate for qualified expenses.

Louisiana values business investment, and when a company moves or expands its fuel and chemical processing industry operations to the state, it can count on innovative solutions to meet the company’s specific needs. For competitive projects that involve substantial new-job creation, major investment and the majority of sales to out-of-state customers, Louisiana has the ability to be agile and flexible — customizing incentives and workforce solutions, aligning state and local resources, connecting companies with valuable resources, and coordinating permitting and startup activities to ensure that operation proceeds smoothly and on schedule.

Pro-Business Climate for Process Industries

At the core of Louisiana’s competitive advantages is the strength of its business climate. In recent years, the state has enacted reforms to create an atmosphere that Forbes magazine called “America’s new frontier for business opportunity." Louisiana now ranks in the Top 10 states for business climate in the U.S., according to Area Development, Development Counsellors International and Site Selection.

Louisiana’s low-tax environment offers business operations significant cost savings. According to a 50-state analysis by the Tax Foundation and KPMG:  Location Matters: The State Tax Costs of Doing Business, Louisiana's tax burden ranks among the top 10 lowest in the nation for new facilities, relocations, and facility expansions for a variety of firm types, including:

• labor-intensive manufacturing
• capital-intensive manufacturing
• research and development facilities
• corporate headquarters

A location in Louisiana can reduce company costs because of the state’s low industrial electricity rates — 2018 rates averaged approximately 19 percent below the national average.

Louisiana’s industrial natural gas rates are also highly competitive, with the state’s 2018 rates averaging the third-lowest in the South and approximately 18 percent below the national average.

Expedited Permitting Reduces Start-up Time

Louisiana understands that a company’s ability to ramp up quickly and efficiently is a significant factor in deciding its location decision. To maximize time and efficiency for companies, the state has created an expedited environmental permit-processing program, which enables Louisiana to issue permits more quickly and efficiently than most states in the country.

The program proved to be a tremendous asset to Cheniere Energy as they identified an opportunity to expand and stabilize a volatile Liquefied Natural Gas (LNG) market with a new export terminal in Cameron where they already operated an LNG import terminal. Not only did such a massive undertaking require a substantial investment, Cheniere also needed proper permitting and qualified staff to manage the facility’s new capabilities.

Working closely with LED and Louisiana’s congressional delegation, Cheniere received authorization from the U.S. Department of Energy in May 2011 to become the first domestic export terminal authorized to export natural gas.

A Strategic Location for Streamlined Growth

Louisiana’s location is one of its most valuable assets. Louisiana’s 18 refineries account for 18 percent of the total U.S. refining capacity. The state’s superior transportation infrastructure and proximity to abundant natural resources, coupled with a large selection of identified and certified sites make doing business in Louisiana an optimal choice for fuel and chemical processing industry operations.

Louisiana is one of only two states in the country where all six of North America’s class one railroads converge. In addition, Louisiana has more than 24,000 miles of natural gas pipeline, carrying natural gas to all parts of the country. There are also pipelines that carry refined products such as gasoline from and through Louisiana to other states.

Louisiana is well situated for both inbound and outbound logistics. The state is home to:

• Six interstate highways
• Six Class 1 railroads
• Six deep water ports
• Seven primary airports

View how Louisiana’s development-ready certified sites intersect with inbound and outbound logistics, view demographic information and more in the Site Selection Center.

Feedstock Offers Opportunities

For bio-derived commodities, Louisiana’s diverse portfolio of feedstock supports processing and transport of primary crops in-state that include timber, sugar, rice, corn, cotton, grasses and beans. The state also has a significant number of biofuel facilities, sugar mills, mood product manufacturing facilities, pulp and paper mills, and rice mills. Extensive offtake agreement relationships exist within the state, and LED has significant insight into opportunities for companies to create strategic partnerships.