W.Va. cracker chase enters waiting phase

LAWRENCE MESSINA Associated Press Published:

CHARLESTON, W.Va. (AP) -- West Virginia's hunt for a multibillion-dollar chemical plant has come down to talks between potential investors and private property owners, Commerce Secretary Keith Burdette said Thursday.

Burdette told The Associated Press that the two companies that each want to build a massive "cracker" facility in the Marcellus shale region are negotiating with owners of potential sites.

These plants convert or crack molecules in a byproduct of Marcellus shale natural gas into a widely used compound. The chemical industry estimates a West Virginia cracker plant could create more than 12,000 direct, indirect and "induced" jobs. The latter would result from increased consumer spending.

Those seeking to build a Marcellus-fueled cracker include Houston-based Shell, the U.S. subsidiary of Royal Dutch Shell PLC. Gov. Earl Ray Tomblin flew to Houston a week ago with Burdette and other top administration officials to pitch West Virginia as the best site for a cracker.

Burdette said Shell has focused on sites around New Martinsville, on the Ohio River in Wetzel County, and points northward. Those potential locations include Hancock County, where there appear to be suitable tracts near the Mountaineer Casino, Racetrack and Resort.

The other company the state is courting, which officials have not identified, is reviewing sites along the Kanawha River as well as in the Parkersburg area, Burdette said.

But Ohio and Pennsylvania are also competing for these facilities. Each has offered or proposed tax incentives to land one or more. At Tomblin's request, the Legislature passed a bill last week that would slash the property taxes for a cracker plant for 25 years in exchange for an investment of at least $2 billion. State revenue officials estimate that the measure would cut potential taxes on real estate, machinery and inventory from $30 million in the first year to $1.5 million.

Lawmakers fast-tracked the bill, approving it in time for Tomblin to sign before his Houston trip. Tomblin later told AP that he may seek an additional measure from the Legislature, regarding "location and regulation." Burdette on Thursday said that any additional measure would be proposed only if a specific site needed legislative action to ensure it could host a cracker plant.

These facilities convert ethane, the Marcellus byproduct, into the basic materials for a wide array of consumer and industrial materials including plastics, fertilizers and antifreeze.