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Decision near on plant location

January 12, 2012
The Herald-Star

PITTSBURGH (AP) - Pennsylvania, Ohio and West Virginia officials are waiting to hear which will be the home for a huge new chemical plant that could bring thousands of new jobs and millions of tax dollars to the winning state.

Shell Oil Co. said it will announce a site for the plant early this year but won't say which state has the lead.

Shell's plans are driven by the vast natural gas reserves discovered in the Marcellus Shale, a deep formation that lies beneath New York, Pennsylvania, Ohio, West Virginia and parts of other states.

The plant eventually could rival Andrew Carnegie's investment in the steel industry, said C. Alan Walker, secretary of Pennsylvania's Department of Community and Economic Development.

Walker said he can't comment on the incentives Pennsylvania has offered for the plant because of a confidentiality agreement. But he said regardless of Shell's decision, the region is on the verge of an economic transformation because of the vast amounts of low-cost shale gas available.

"We're going to get a new look from a lot of industries," Walker said. "It will be the revitalization and reindustrialization" of Pennsylvania.

The main product at the proposed Shell plant would be ethylene, which is used to produce chemicals that go into everything from plastics to tires to antifreeze. Workers would break apart the molecules of the raw gas so it can be turned into various products.

The American Chemistry Council, in a report last year, estimated the new chemical complex could attract up to $16 billion in private investment and create more than 17,000 jobs and billions of dollars in tax revenue for the region.

Shell spokeswoman Kelly op de Weegh said the company also is considering building several specialized plants at a future site to produce chemicals such as polyethylene, used in plastic bags, and ethylene glycol, used in antifreeze.

There have been reports that both Ohio and West Virginia are offering substantial tax credits to land the plant. Ohio Gov. John Kasich flew to Houston in late November to pitch his state to Shell officials, the Columbus Dispatch reported.

Kathryn Klaber, president of the Marcellus Shale Coalition, an industry group, said the proposed plant would serve as an anchor for the region, attracting related industry.

"It will certainly validate what everyone has been talking about, the sustainability and long-term viability of this resource," she said. "It's aligned with where a lot of the gas is coming from."

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