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Released September 21, 2015 | SUGAR LAND
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Researched by Industrial Info Resources (Sugar Land, Texas)--Consistent with the past few years, the U.S. Southwest region leads the rest of the nation in its total investment value (TIV) for projects expected to begin construction in the fourth quarter of 2015. The region expects to see more than $23 billion in projects kick off, according to Industrial Info's database, heavily influenced by the rapid growth of the energy industry along the Gulf Coast. More than half of the total value can be found in four industries: Alternative Fuels, Oil & Gas Production, Power, and Metals & Minerals.

Click to view US Southwest Project Kickoffs, 4Q15Click on the image at right for a graph detailing active projects scheduled to kick off in fourth-quarter 2015 in the U.S. Southwest by industry.

The Southwest region includes Arkansas, Louisiana, Oklahoma and Texas. The bulk of the spending, more than $21 billion, comes from Texas and Louisiana, where energy-related projects along the Gulf Coast are driving many of the investments. Only a single project among the 10 highest-valued is outside these two states.

The Alternative Fuels Industry nudges the Oil & Gas Production Industry out of the top spot with $3.68 billion in projects set to begin construction in fourth-quarter 2015, although this total is almost entirely related to a single, highly uncertain project: Summit Power Group Incorporated's (Seattle, Washington) $3.5 billion coal gasification project in Penwell, Texas. The kickoff date is highly tentative--at its fastest, the project has moved forward in fits and starts over the past six years, and has seen several kickoff dates fly by without a dent in the dirt. The company is still trying to finalize engineering, procurement and construction (EPC) contracts, but has Technip USA Incorporated (Houston, Texas) and Siemens AG (NYSE:SI) on board as consultants. For details on this highly anticipated project, see Industrial Info's project report.

The Oil & Gas Production Industry is only slightly behind with $3.28 billion in projected kickoffs, but its total comes from a larger number of projects. The biggest, however, faces similar uncertainties: Cheniere Energy Incorporated's (Houston) $2.5 billion construction of the sixth train at the Sabine Pass LNG Production in Cameron, Louisiana. The facility already has three other trains under construction; the sixth is expected to produce 4.5 million metric tonnes per year of LNG, bringing the facility's total production capacity to 24.5 million metric tonnes per year. Although the kick off could be delayed, Cheniere has Bechtel Group Incorporated (San Francisco, California) on board for EPC services and has signed a tolling agreement with Total Gas & Power North America (NYSE:TOT) for approximately 2 million tonnes per year. For details on this project, see Industrial Info's project report.

The Power Industry holds its own at $3.06 billion in projects set to begin construction from October through December, including the only one in the top 10 that is not located in Texas or Louisiana: Apex Clean Energy's (Charlottesville, Virginia) $600 million Kay Wind Project in Newkirk, Oklahoma. The 300-megawatt (MW) project will consist of 130 Siemens SWT-2.3-108 wind turbine generator sets, each with a capacity of 2.3 MW. For details on this construction project, see Industrial Info's project report.

The Metals & Minerals Industry is looking at $2.5 billion in construction starts in the U.S. Southwest from October through December, almost all of which is tied to Revolution Aluminum LLC's (Pineville, Louisiana) $2.4 billion construction of a flat-rolled aluminum minimill in Pineville. The multi-phase project involves building a 1.4 million-square-foot mill to supply more than 1.3 million pounds per year of aluminum to the automotive industry. W.G. Yates & Sons Construction Company (Birmingham, Alabama) is performing EPC services. For details on this construction project, see Industrial Info's project report.

The remaining six highest-value projects set to kick off in the U.S. Southwest region in the fourth quarter are:
  • $1.3 Billion: Louisiana International Gulf Transfer Terminal Authority's Transfer Terminal in Venice, Louisiana
    For details on this construction project, see Industrial Info's project report.
  • $1.2 Billion: AM Agrigen Industries LLC's St. Charles Fertilizers Plant in Killona, Louisiana
    For details on this construction project, see Industrial Info's project report.
  • $1 Billion: Energy Transfer Partners LP's NGL Pump Station in Midland, Texas
    For details on this construction project, see Industrial Info's project report.
  • $550 Million: Quantum Energy Partners' Clear Springs Peaking Plant in Geronimo, Texas
    For details on this construction project, see Industrial Info's project report.
  • $500 Million: Cheniere Energy Incorporated's San Patricio Hub Condensate Stabilizer & Splitter in Edroy, Texas
    For details on this construction project, see Industrial Info's project report.
  • $460 Million: Brightman Energy's Mariah Windfarm in Bovina, Texas
    For details on this construction project, see Industrial Info's project report.
More than half of the region's TIV--more than $13.52 billion--is related to 94 projects that are now in the planning stages, where plenty of factors could increase, decrease or eliminate the expected spending. The region also has 141 projects worth more than $9.09 billion in the engineering stages, while 163 projects worth $398 million already have kicked off the first stage of construction and will kick off the second in the fourth quarter.

Industrial Info's Gulf Coast Region Labor Market Analysis provides insight into historical and forecast capital and maintenance spending through 2020, as well as current wage rates and expectations for the future. To learn more about this product, contact Industrial Info's VP of Labor Analytics, Tony Salemme, at tsalemme@industrialinfo.com or by calling (209) 547-9878.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.
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