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Texas Gulf Coast Gets 20 Billion From Santa Oil Can

Texas Gulf Coast Gets 20 Billion From Santa Oil Can

Over 20 Billion dollars is coming to the northern end of the Texas Gulf Coast about an hour away from the Galveston County beachfront resorts. The biggest capital investment Texas has ever received!

Rule of thumb for what that translates into the local economies is six times the investment as the money churns around changing hands through purchases and real estate development. Making Santa Oil's gift worth over 180 Billion dollars - what changes we'll see in this area from that kind of capital is going to be incredible.


Motiva Enterprises Royal Dutch Shell and Saudi Aramco, will invest $7 billion to expand an existing refinery in Port Arthur, less than an hour from Bolivar peninsula beachfront homes, creating the largest oil refinery in the United States.

The expansion will more than double the capacity for the existing refinery to 600,000 barrels a day. It will make enough fuel to fill about 700,000 cars a day. The project should be finished in 2010. The Port Arthur project will surpass Exxon Mobil Corp.'s facility in Beaumont, currently the largest U.S. refinery.

National oil companies such as Saudi Aramco are building refineries and expanding existing ones for several reasons. Iran, Iraq and Venezuela are trying to build refineries to meet domestic demand and lessen imports of gasoline. In theory, expanded refinery production would add supply to the U.S. market and cause gasoline prices to fall.

Workers wanted
In Port Arthur, expansion managers are wrestling with their own cost issues. "Labor is probably going to be our biggest challenge," said Forest Lauher, head of the project expansion for Motiva.

The Beaumont native said there's a shortage of skilled welders in the area, and he's working with construction company Bechtel to train more. Motiva will need at least 4,500 construction workers to build the facilities and 300 people to operate them permanently.
Mr. Lauher said he may have to hire from outside the area, even outside the U.S., to find enough workers.


The Valero Energy Corporation announced that they are going to spend about $2 billion to build a new plant in the Beaumont area and Eastman Chemical said that it plans to operate and invest in two new plants on the Gulf Coast -- including one in Beaumont, Texas.

Eastman Chairman and CEO Brian Ferguson say the new $1.6 billion plant slated for Texas would be located in Beaumont, Texas. Eastman expects the regulatory permit application process to begin later this year, and construction is expected to be under way by early 2009.

Construction employment is expected to peak at 1,300-1,500 workers, with permanent employment expected to be approximately 250. Eastman expects to have an equity position of as much as 50 percent and to announce a co-investor in the near future.

Beaumont ISD school trustees Thursday night approved a tax abatement worth $86 million to help lure Eastman to the area. Jefferson County and the City of Beaumont are expected to approve similar tax abatements for the company.


The Galveston County Bolivar Resort area is already starting to get interest from new employees getting ready to relocate to the Beaumont Port Arthur area and from support firms doing the development of the expansion of the new facilities.
  • The Beaumont Enterprise newspaper reports that over 20,000 news homes will be needed to accommodate incoming employment demand.
  • Google trends reports Beaumont is the number one city searched for - regarding real estate - in the entire United States. The Bolivar Peninsula is "Beaumont's Beach"
  • Crown Team Texas, the leading resort developer on the Bolivar Peninsula reports that relocating engineers for the new plants, and refinery developers from Bechtel Engineering, have been frequenting their resorts looking for oceanfront second homes and primary homes.
  • Interviews with local residents in the area are saying that the building boom is incredible and new shopping malls, hotels, homes and apartments are going up like popcorn.
See our article on Texas Gulf Coast Booms in 2008
More Good "Energy" for the Texas Gulf Coast

The new pipeline, called "Texas Access Pipeline," would transport crude oil sourced from the Canadian oil sands region in Alberta and from the upper U.S. Midwest to refiners in the Nederland and Houston, Texas, areas.

Enbridge Inc. and ExxonMobil Pipeline Company announced the two companies will conduct a Solicitation for Binding Shipper Commitment for a proposed new pipeline system, to transport crude oil from Patoka, Illinois, to the Texas Gulf Coast. The new pipeline, called "Texas Access Pipeline," would transport crude oil sourced from the Canadian oil sands region in Alberta and from the upper U.S. Midwest to refiners in the Nederland and Houston, Texas, areas.

The proposed project comprises a new 768-mile, 30-inch diameter pipeline, which would transport crude oil from Patoka, Illinois southward to Nederland, Texas. Also proposed is an 88-mile, 24-inch pipeline to transport crude oil onward from Nederland to a delivery point in the east Houston area. Through connections with existing terminals in Nederland and Houston, the new pipeline system would provide shippers with the added flexibility of moving onto different crude oil distribution pipelines.

See www.texasaccesspipeline.com

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