The U.S. manufacturing sector continues to show growth and optimism in the latest survey conducted by the National Association of Manufacturers (NAM). Nearly 90 percent of those responding say they were somewhat or very positive about their company’s growth, predicated on current federal tax and regulatory reforms from the Trump administration.

Of those responding, more than 70 percent registered concerns over attracting and retaining a quality workforce; 57 percent are concerned about rising health-care costs, 53 percent are troubled by trade uncertainties and 56 percent are worried about increased raw material costs.

The consensus of respondents indicates that they expect capital expenditures to rise 2.8 percent during the next 12 months.

Industrial Info Resources is tracking more than $42 billion in planned U.S. industrial manufacturing starts in the second quarter of 2019.

A major second-quarter startup is the first phase of Indiana Neighborhood Assistance Program’s (NAP) Digital Crossroads Data Center in Hammond, Ind. In concert with Hasse Construction (Calumet City, Ill.), Indiana NAP plans to develop the data center on the site of a retired power plant. The project includes a 105,000-sq.-ft. building with cooling systems for data storage.

The automobile industry also is involved in a variety of expansions, grassroots plants and additions scheduled to start in the second quarter. Fiat Chrysler Automobiles NV is retooling and upgrading its truck assembly plant in Warren, Mich. The company plans on investing $4.5 billion in five existing Michigan plants.

The U.S. Mid-Atlantic is reporting $2.5 billion in second-quarter industrial manufacturing projects starts. Data centers represent one of the chief types of industrial manufacturing projects set for the second quarter. Alphabet Inc.’s expansion of its Google data center in Moncks Corner, S.C., is just one of the many planned for the second quarter. This project will add a new building to the seven-building complex. 

The replacement of Terminal D at the George Bush Intercontinental Airport in Houston is planned to start construction during the second quarter. The new 780,000-sq.-ft. terminal will have 15 new gates for wide-body aircraft. 

Pipeline Projects

Energy remains a prime mover behind second quarter 2019 construction starts. The United States is expected to see $4.8 billion in pipeline project start-ups in the second quarter.

The Southwest market, which includes Texas, Louisiana, Oklahoma and Arkansas, leads the country with $1.8 billion in planned starts. The Northeast market region follows with 30 projects with a total investment value (TIV) of $1.36 billion.

One of the main projects set to start up in the second quarter is Equitrans Midstream Corp.’s Hammerhead natural gas pipeline in Pennsylvania and West Virginia. The pipeline will feed up to 1.2 billion ft.3 per day into the Mountain Valley Pipeline, currently under construction.

Shell Midstream Partners is to begin construction on the Falcon ethane pipeline in Ohio, Pennsylvania and West Virginia to feed the Royal Dutch Shell’s ethylene production facility located in Monaco, Pa., currently under construction.

In Oklahoma, DCP Midstream is scheduled to begin construction of the Cimarron River grassroots natural gas pipeline during the second quarter. This pipeline will transport up to 613 million ft.3 per day from their facility in Beaver County, Okla., north to Liberal, Kan.

Cheniere Energy Inc. and EIG Global Energy Partners have completed financing and issued a full notice to proceed on the construction of the Midship Project natural gas pipeline, a project with a TIV of $680 million. It will create pipeline capacity of up 1,440,000 dekatherms per day of transportation from the STACK and SCCOP play in Anadarko Basin in Oklahoma to the growing Gulf Coast and Southeast markets.

 White House’s Energy Goals 

At the time of this writing, the White House is planning an executive order that aims to boost pipeline construction and lower energy prices. The order directs the Department of Energy and the Environmental Protection Agency to clarify Section 401 of the Clean Water Act. This is the law giving states authority over permits where water quality is of concern. 

The effort is spurred by the blockage of the construction of the 125-mile Constitution Pipeline from Pennsylvania to New York. 

The administration’s broader goal is to lower energy prices by accelerating the transportation of natural gas and reaffirming U.S. energy dominance.

Backlash from states and governors is expected, especially New York, were regulators warned of further legal action if the Federal Energy Regulatory Commission throws out its water safety review for the Constitution Pipeline case.

Energy executives are optimistic about the prospect of increased pipeline construction. Dennis Xander, chief executive of West Virginia-based Denex Petroleum, says that the state is at risk of a glut if it cannot move gas to New England or the Gulf states. “We now have more gas for the first time in several years,” he notes. “There is no pipeline to get the gas transported.”

Refining Projects

The U.S. Refining Industry will see more than $2.4 billion in second-quarter starts. Virtually all the projects are located in the Southwest region, primarily in the Texas and Louisiana Gulf Coast areas. 

The largest Gulf Coast project is Marathon Petroleum Corp.’s multiphase South Texas Asset Repositioning (STAR) Project, scheduled to start up in May. The project includes a $500 million crude unit expansion, increasing capacity from 437,000 to 477,000 BBL/d and improving gas-oil and distillates yields; a $450 million residual hydrocracker unit expansion increasing capacity from 64,00 to 84,00 BBL/d; and $500 million in offsite utility additions to support the complete complex.

The STAR Project is designed to merge Marathon’s existing Texas City Refinery into the new Galveston Bay complex. The Texas City Refinery is currently undergoing a $200 million hydrotreater unit expansion, adding 65,000 BBL/d of ultra-low sulfur diesel production.

Power Projects

In the Mid-Atlantic region (Maryland, North Carolina, South Carolina, Virginia and West Virginia) the power industry has more than $4.7 billion in project starts in the second quarter, with Virginia having the largest project. 

Balico’s 1,650-megawatt project is the largest set to kick off in the second quarter. It is a combined cycle natural gas-fired plant near Charles City, Va., and has a TIV of $1.3 billion.

In North Carolina Reidsville, NTE will start construction in the second quarter on a 500 MW combined cycle power plant. Gemma Power Systems is providing engineering, procurement and construction for the project, which has a TIV of $510 million.

This report is just an overview highlighting major events set to occur during the second quarter of 2019.

PVF Industry Opportunities

The year 2019 looks to be developing into a year of opportunity for those in the PVF industry.

The pricing for those using carbon-steel butt welding fittings and forged carbon-steel flanges will remain stable through the second quarter. Keep in mind that is recommended to check with your suppliers frequently in case of an unexpected event or changes in availability 

 To keep current with developing opportunities, the PVF Roundtable’s Networking Meetings provide a valuable platform for keeping pace with the dynamics of the PVF industry, the exchange of ideas and information and the opportunity to expand your contact base. This is the place where industry movers, shakers and decision-makers meet.

The board of directors encourages you to attend the next PVF Roundtable Networking Meeting, scheduled for May 14, beginning at 4:30 p.m. at Houston’s The Bell Tower on 34th. 

The meeting will be preceded by the PVF Roundtable Golf Tournament to be held at three courses at The Kingwood May 13. We encourage all interested to register early at www.pvf.org.