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Acadiana Lifestyle

Optimistic Outlooks

10/05/2018 07:00AM ● By Robert Frey

Local Economic Indicators For The Oil & Gas Industry

By Patrice Doucet

While oilfield activity and the price of oil have been about as steady as the Gulf tides, leaving many industry businesses still down, the Port of Iberia offers encouragement with diverse growth, particularly in the past year and a half.  From expanding real estate and improving infrastructures to sealing deals with international companies, here’s a look at how the activity at the Port of Iberia acts as an economic indicator of the oil and gas industry. 

The spring of 2017 saw bright spots appearing when a 30,000 sq. ft., $4.5 million facility was completed at the Port of Iberia storing large components of offshore rigs for Logan Industries.  At another slip, two new buildings were constructed at a cost of $7.5 million for Ram Design, LLC, a consulting and inspection company providing services in the ultra-deep Gulf of Mexico waters. By the last quarter, negotiations with prominent companies were solidified.

This year so far, significant new tenants include Port Aggregate, one of the largest producers of ready mix concrete in Louisiana and Crosby Energy, a fabricator of ASME-coded pressure vessels that, according to Port Executive Director Craig Romero, will be shipped to North Dakota, Pennsylvania, West Texas and the Gulf of Mexico.  In other fabrication-related developments, the port welcomed machine shop manufacturer Cornerstone Fabricators, LLC and RedGuard, a Kansas-based company that fabricates explosion-proof buildings.  Meanwhile, port authorities are moving ahead with improvements to a site for soon-to-come Caliche, a Houston-based company that will establish an intermodal loading and unloading facility as well as storage for natural gas liquids.

Louisiana Cat is expanding their current property, working on infrastructure improvements and extending the natural gas line to the facility.  The project was a year in the making with the $1.2 million cost for the pipeline installation shared in a unique partnership between Louisiana Cat, Iberia Parish Government and nearly half funded by the state.  The new location adds 68 jobs in Iberia Parish, enhancing Cat’s presence at the port. “To get a consortium of public entities to put up money in making a project of this size possible, while creating jobs, is amazing,” says Romero.

The Louisiana Cat rebuilds and services engines and related equipment for marine, oil and gas, industrial and utility companies.  The New Iberia facility has served as a go-to showplace for Romero when touring prospective tenants around the harborside.  “It’s state of the art,” he exclaims, “water pressure and temperatures are monitored on engines throughout the Gulf in real time from this facility.  And, the company’s mechanics train here to work all over the world.”
 
Other considerations that have attracted nearly 100 businesses to the port include its proximity to the Gulf, year-round favorable weather to work, and its “pro-business and can-do attitude,” according to Mike Tarantino, Executive Director of Iberia Industrial Development Foundation.  “The work force here has been doing these type projects for many years, making them very skilled and a valuable resource,” he says.
  
As for its industrial real estate, with only four acres left to lease in September, port authorities purchased 106 more acres, from Goldman Sachs, located on the back tract formerly known as Dynamic West for $5.5 million.  The site includes multiple buildings, one of them towering 95 feet, housing 180,000 square feet, just waiting for the company with ambitions as grand.  Also earmarked are another 40 acres for the Caliche project, with plans of digging a canal through it. 

The port team continues to work with the U.S. Army Corps of Engineers to advance plans for the Acadiana Gulf of Mexico Access project, that involves deepening the channel to the Gulf, which has been in the works for 20 years.  With over $30 million spent to date, Romero says they are working with the federal delegation and meeting the criteria of the Corps of Engineers, which is a long process.  “There’s a long punch list,” he says “new bulk heads must be placed in front of the old ones to accommodate a 20-foot channel.  And, we have to relocate pipelines - 38 of them to be lowered - which is costly.”

In looking to the future, Romero is optimistic, but also realistic saying, “So many worldly events go into driving the price of oil; keeping an eye on those activities gives us a feel for what direction to go.  I’m optimistic now [in September] as the price of oil hovers at $69 a barrel.  I look at other indicators that show hope:  Halliburton built a $68 million ‘super center’ near the airport just over a year ago, and they are adding a $5 million building that will be utilized for tool storage. The fact that this is all happening in Iberia Parish is tremendous.”
 
Tarantino adds that the port is readying to handle greater activity by working with prospects. “We’re excited that businesses are continuing to expand and that we’re looking better and better each year, which is vital to creating and sustaining jobs and economic growth in Iberia Parish.”



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