Calcasieu Ship Channel: Economic Impact Study 2017
On November 9, 2017, the Lake Charles Harbor & Terminal District released the 2017 update of the Economic Impact Study of the Calcasieu Ship Channel.
The Economic Impact Study concludes that the Calcasieu Ship Channel is the main marine transportation corridor and infrastructure for sustained economic development in the SWLA Region. The importance of the Channel and terminal facilities to the overall economic impact in 2016 for the SWLA Region is evidenced by the 37,159 direct, indirect, and induced jobs; $5.7 billion of GPD; and $118.8 million generated in local sales and property taxes. Additionally, 56 million tons of cargo came into the port district in 2016. The Calcasieu Ship Channel is truly the heart of the SWLA Region’s economy.
The 2023 completed ship channel related economic development expansion projects measured in 2016 dollars will facilitate an additional 10,729 jobs, add $4.9 billion of GPD, and contribute an additional $100.4 million in local sales and property taxes.
The Channel’s impact reaches beyond the Lake Charles metro area. In 2016, over 50,000 Louisiana jobs and $187.8 million of Louisiana production, state sales and production taxes were generated by channel-dependent businesses. The aggregate statewide will grow by more than $101.7 million in new sales and income taxes generated from these new economic drivers.
All of these impacts are conditioned upon the Channel’s ability to meet the needs of business and industry, now and in the future. The Channel can only meet these needs if it is consistently maintained at the congressionally authorized dimensions of 400 feet wide by 40 feet deep.
Calcasieu Ship Channel Traffic Study
Port of Lake Charles officials released the 2018 Update of the Calcasieu Ship Channel Traffic Study which analyzes the current and future increase in Calcasieu Ship Channel vessel traffic.
Traffic in the channel is expected to grow significantly over the next ten years due to the expanded operations of existing terminals and the construction of various proposed facilities. Deep-draft ship traffic is forecasted to more than double by 2025, growing from 1,098 to over 2,342 vessels. The fifteen-year horizon of the study projects 2,607 deep-draft vessels annually in 2033.
The final report found the channel, with its existing infrastructure and operations, has the capacity to handle the forecasted traffic increase. The port’s leadership commissioned the study, which used a detailed simulation model, to assess the need for changes to the channel’s operation.
Project cargo for the Sasol project was unloaded at Bulk Terminal 1 (BT1).
“The Calcasieu Ship Channel is vitally important not only to the Port of Lake Charles and surrounding industries that daily depend on access to it, but also to the entire country,” said Bill Rase, executive director for the port. “This waterway handles nearly 55 million tons of cargo annually and is absolutely critical to supplying the nation’s energy needs. Keeping the channel operating smoothly for trade is the port’s top priority.”
The port is currently the thirteenth largest port in the country based on tonnage handled. It is anticipated that tonnage through the new facilities planned for the channel will place the Port of Lake Charles in the top ten ports in the nation.
Other conclusions reached by the traffic study are related to seasonal impacts, pilots needed, and tug requirements. The study determined wait times were highly seasonal, which was attributed to wind and visibility delays. The channel will require additional pilots to handle the forecasted traffic. However, the study determined the current number of channel tugs is likely sufficient for the channel, assuming the LNG terminals provide their own dedicated tugs.
New capital investments totaling over $85 billion have either been announced or are under construction in the Southwest Louisiana region within the past two years.
Rase asserted, “Most of these projects are a direct result of the Calcasieu Ship Channel, as well as an efficient pipeline infrastructure, which will deliver economical natural gas for refining into finished product for export and domestic use. These projects are completely dependent upon the ship channel’s efficient operation, as well as consistent dredging funds from the U.S. Congress that allows the Corps of Engineers to maintain the Calcasieu Ship Channel at authorized dimensions.”
To read the full study, click here