Future Industrial Project Spending in Arizona Explodes to $21 Billion

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Over the past 3-4 years, Industrial Info Resources (Sugar Land, Texas) has observed significant growth for industrial project spending in Arizona. That trend continues today, as 123 major capital and maintenance projects totaling more than $21 billion are planned to start construction in 2007 or beyond. This is up from $8.7 billion for 73 future projects that were being tracked in 2005. That’s an increase of 141%. For details on the 2005 analysis see related March 14, 2005 news article - Planned Industrial Project Spending in Arizona Moves to $8.7 Billion.

About 40% of the spending is planned for Maricopa County. Yuma and Pinal Counties are the next two largest counties for future industrial project spending with $3.5 billion and $2.2 billion, respectively. Apache, Cochise, Navajo and Pima counties each have more than $1 billion in industrial projects planned.

Click on the image at right to view a chart showing the breakdown of industrial project spending by county in Arizona.

The most active industry in Arizona is the Power Industry with more than half of the planned future spending at $11.5 billion from 36 separate projects. The largest project currently under study in Arizona is plans to add two new nuclear units at the Palo Verde Nuclear Power Station in Tonopah, Arizona. Plant owner, Arizona Public Service Company indicates that the earliest construction could begin on the $5 billion project is 2012 due to the lengthy licensing and engineering process.

Strong metal prices, such as that for copper, and surging economics for cement manufacturers is driving the Metals & Minerals Industry spending in Arizona. The Metals & Minerals Industry is second behind the Power Industry with 23 projects totaling $2.8 billion. A large majority of the project spending for the Metals & Minerals Industry in Arizona will be for grassroot construction and expansions of existing plants/mines. For example, Carlota Copper Company just started construction on a new open pit copper mine in Miami, Arizona. Industrial Info has tracked this project since 1992. Copper economics, which proved the project unfeasible in the 1990s and early 2000s, has now turned around paving the way for a number of projects to move forward.

Other significant future project spending industries in Arizona include Oil & Gas Transmission, Pharmaceutical & Biotech and Industrial Manufacturing. Arizona Clean Fuels Yuma continues to develop a $2.5 billion crude oil refinery in Yuma, Arizona. This project has been delayed for two years as project proponent work on financing, supply and delivery issues.

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