Port of South Louisiana Riding High on Natural Gas Boom

Posted by PortVision

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Location, location, location

The Port of South Louisiana is located on the Mississippi River between New Orleans and Baton Rouge. It is ideally positioned to take advantage of the increased shipping needs of the more than 150 petrochemical facilities and refineries also located along that stretch of the river.

 A January report posted by Yale’s e360 stated that the US Environmental Protection Agency has issued 105 more permits for oil, gas and chemical plants with an additional 15 permits pending. All of these plants will use natural gas as a feedstock, produced in abundance by fracking, according to the Louisiana Environmental Action Network. These new plants will lead to a tremendous increase in shipping service demands from the port in coming years.

Importance of the Port of South Louisiana

The Port of South Louisiana is spread out over 54 miles of the Mississippi River in the area between New Orleans and Baton Rouge, with its operating headquarters in LaPlace, Louisiana. It was first established in pre-colonial times to transport grain, furs, and other goods from the New World to France, and it has gone through numerous changes, expansions, contractions, and even blockades, since its humble beginning. Today, over 60% of its goods are still grain shipments.

Due to its location on the Mississippi, the Port of South Louisiana (PSL) is a key part of the nation's infrastructure; receiving and shipping goods to and from places all over the US. In fact, the port is the 16th largest port in the world and currently processes more than 6,000 ships every year. The nearby ports of New Orleans and Baton Rouge are similar in size and, combined, the three ports are considered to be the largest shipping facility in the world. Together they have been estimated by the North American Grain Association to handle over 65% of America's food exports.

The Port of South Louisiana calls itself the largest tonnage port district in the Western Hemisphere. Biz Magazine writes that in 2014 the port achieved a record shipment level of 291.8 million tons of imports and exports processed by the facility. This tonnage figure represented a 12% increase over the previous year, and surpassed the previous record set in 2012 of 278.9 million tons. In addition to exporting grain and other foodstuffs, the port’s main imports include steel, coffee, iron, rare earth minerals, electronics, and petroleum products.

Secure and Vital to the US

Because of the importance of this shipping facility to the US economy, many of the improvements made in the past decade (after 9/11 and Hurricane Katrina) have related to security issues.  The port has been identified as “vital” by the Department of Homeland Security, a designation that gives the facility priority for repairs in the event of natural or man-made disaster. It has also meant that the government has invested millions of dollars in inspection and security-related facilities at the Port. The result of these improvements, jointly overseen by the Lower Mississippi Port-Wide Security Council and the Department of Homeland Security, is that the port is now one of the most secure shipping facilities in the nation, putting it in position to expand operations relating to a variety of sensitive cargo shipments including natural gas and fertilizers.

New Expansion

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The Port of South Louisiana has increased its processing of crude oil shipments by 1,783 percent in the past two years. It is now estimated that nearly half of the United States' petroleum imports and 25% of its exports pass through the port. It is now poised to experience similar growth in natural gas shipments.

The port’s Executive Director, Paul Aucoin, is seeing new national and international energy company interest in locating in the River Parishes within the Port District. He recently indicated to Fox News that the American Association of Port Authorities now recognizes the Port of South Louisiana as the number one energy transfer port in the US, and that Marathon, the third largest refiner in the US, will soon expand its plant near the port. As well, new and newly revived ethylene production facilities, such as the Dow Chemical plant in Hahnville, Louisiana, are gearing up.

The port also recently reached a deal with Monsanto that will give it approximately $1 billion to expand its Luling Facility, responsible for most food shipment from the port. First Bauxite has announced a $200 million investment in the port for bauxite processing. In addition, the port is actively working to attract more foreign investment, and, so far, has attracted over $5 billion in investment dollars from Germany, Norway, China, and other countries.

Because of the increased security, long and successful history of processing large shipments from all over the world, and proximity to rail, air, and road transportation, the Port of South Louisiana is uniquely positioned to increase its imports and exports of petroleum and natural gas.

 

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Posted on Jul 21, 2015 8:05:00 AM

Topics: Blog, oil, ports