Linda Harris | January 2, 2018 | WV News
MOUNDSVILLE — China Energy’s potential $84 billion investment in energy projects in the Mountain State has sparked an uptick in interest in available industrial properties throughout the Upper Ohio Valley, officials say.
The memorandum of understanding, or MOU, is not binding, meaning the Chinese company can still back out if it wants to.
“Everybody’s trying to figure out what it means,” said Bryce Custer, NAI spring real estate adviser, Energy Services.
Custer is working with New York’s Frontier Industrial Corp. to market vacant industrial properties in Marshall and Hancock counties.
“I think what it’s done is to create more of a sense of urgency for some companies.They realize if they want to have a facility in the area, they’d better speed up their game a bit,” Custer said. “So, yes, the MOU has had an impact; we are seeing a good bit more activity.”Custer said he’s been busy fielding calls from clients “looking from Moundsville north to Monaca, Pennsylvania,” where Royal Dutch Shell has already begun building a $6 billion-plus ethane cracker. Frontier’s properties in the Upper Ohio Valley — a 58-acre parcel that once housed a power plant in Moundsville, as well as a thousand surplus acres that steel giant ArcelorMittal wants to unload in Weirton — are generating a tremendous amount of interest because of their river and rail access, he said.
“We’ve got a good bit of activity right now with (the Kammer) facility. We’re working with companies not only within the U.S., but also with some companies overseas. There’s a good bit of interest right now in properties that have rail and barge access for a variety of products. They’re diverse companies ... petrochemical companies, straight chemical companies and also plastics and derivatives,” he said.
Frontier actually owns about 1,100 acres in Weirton, but “we can probably only currently come up with about 300 contiguous acres,” Custer said.
“The rest is scattered,” he said. “If we got some additional parcels, we could probably (put together) 500-750 (contiguous) acres.”
Frontier’s Weirton holdings include Brown’s Island, 230 flat acres in the middle of the Ohio River with limited access, which is a wish-list item for companies shopping for a secure site with limited public access.
“I’ve been working with companies recently that want to build anything from a 30,000-square-foot facility to 500,000 square feet. It’s been all over the map,” Custer said. “And also Brown’s Island, which is right in the middle of the river … we’ve even had some people ask us to do some rail studies on what it would take to get rail lines to Brown’s Island. The best strategy would be to bring rail lines from the Ohio side. In order to make the Brown’s Island facility successful in that regard, it would take a two-state effort to make that happen.
“When we come to Weirton, we’re seeing a great deal of activity,” Custer said. “Again, it’s across-the-board. It’s not only petrochemical-related, but other industries as well. We got Bidell (Gas Compression) at the north side of the facility. We see opportunities for other companies to come, and there are other buildings there to be redeveloped and reused. Frontier has already done a tremendous amount of work clearing the land.”
Pat Ford, executive director of the Business Development Corporation of the Northern Panhandle, has said the Northern Panhandle should reap big benefits not just from the nearby Shell cracker, but also because of its location in the heart of the Marcellus and Utica Shale play.
“‘Optimistic’ isn’t even the right word,” Custer agreed. “Looking at the $84.7 billion MOU, if even a fraction of it comes to (fruition), if we get 5, 10 percent of that, it’s a game-changer for the state of West Virginia and surrounding states as well. So I’m extremely optimistic. We’re fortunate we got that MOU with China Energy. It really has put West Virginia on the map globally.”
Custer said a lot of the progress being made behind the scenes is due to the efforts of state and local groups, including the BDC, the Regional Economic Development partnership and the West Virginia Economic Development Authority.
"They’ve all been extremely helpful with input in making sure we can land projects. We’ve had no roadblocks,” Custer said. “That goes clear to the governor. In other areas it’s a problem, but we have a great working relationship with everybody.