CERAWEEK-Worker shortage a concern for new chemical plants-Fluor

HOUSTON, March 6 Wed Mar 6, 2013 2:52pm EST

Related Topics

HOUSTON, March 6 (Reuters) - Engineering and construction company Fluor Corp believes the main concern for chemical companies with plans for new U.S. plants is a potential labor shortage on the Gulf Coast where most will be built.

A North American glut of natural gas liquids (NGLs) like ethane has led to a handful of announcements about new crackers that convert ethane into ethylene, a building block for many plastics.

Peter Oosterveer, energy & chemicals group president at Texas-based Fluor, said on Wednesday that between four and six new crackers would ultimately be built in the United States.

But the construction alone on those slated for the coast of the Gulf of Mexico would require about 50,000 skilled workers, and that does not include maintenance and related work, he said.

"That makes a lot of people nervous," Oosterveer told Reuters in an interview on the sidelines of the IHS CERAWeek conference in Houston.

On Tuesday, an Exxon Mobil Corp executive told the conference about a multibillion-dollar expansion in Baytown, Texas, already the country`s largest integrated refining-chemical producing site. That project will convert ethylene from a new steam cracker into polyethylene products.

Shortages of skilled labor are a worldwide challenge, which Oosterveer said was behind his company's push to build more sophisticated modules elsewhere that can be assembled on site.

In September, Fluor announced a joint venture with AG&P, a Phillipines-based company specializing in modular engineering and fabrication services, and Oosterveer said it was looking at establishing similar capability in North America.

The executive, having just returned from the Middle East, said the potential for U.S. energy independence made many people there nervous, especially in light of the threat to security posed by Iran's political stance combined with fears that American commitment to the region might wane.

"If there's no need to jump in because you have your own energy here - you're energy self-sufficient - that's a pretty serious concern," Oosterveer said.

Asked about the death of Hugo Chavez, Oosterveer said the questions about his health had for months been hanging over the country, where Fluor has done some early engineering work for a Chevron Corp project.

"I'm hoping that we'll see an environment that is probably going to be a little more friendly to American companies," he said, though he conceded there was no hard evidence for that.

For more stories on CERAWEEK, please see:

FILED UNDER: