As I look for topics to write about, I occasionally do a search to see what Chinese and West Virginia officials are saying about the November 2017 proposed energy deal between the two countries. Most of the time, I come up empty but today I found two differing opinions on the megadeal’s future. Phil Kabler, in today’s Charleston Gazette-Mail, writes about it as part of an article on what various Justice officials told legislators earlier this week:
Also Monday, new Development Office Executive Director Mike Graney told senators that a proposal for more than $80 billion of investment in the state’s natural gas and petrochemical industries by China Energy is still alive, although hampered by a trade war between the United States and China started since the company signed a memorandum of understanding on the investment in 2017.
Graney said China Energy officials have visited West Virginia three times in the three months that he has been head of the Development Office and said the company has taken the reverse approach from typical business investors, who conduct due diligence before announcing a project.
“They made a big announcement, and now they’re doing a whole lot of due diligence,” said Graney, who added that China Energy is working on three active projects.
“It’s likely something will happen this year,” he said.”
On the other hand, Ken Silverstein, who writes on energy matters for Forbes magazine, raised doubt as to whether anything would happen this year. Yesterday’s Silverstein column is titled
How Trump Could Burn West Virginia, Causing It To Lose An $84 Billion Gas Deal With China
Silverstein looks at the effects of Trump’s trade war and concludes:
But the biggest victim here would be West Virginia. Insiders told this reporter at the state capitol that Governor Justice doesn’t expect talks to get back on track for at least a year. That’s a long time for a state that is bleeding population and where the gross domestic product fell in 2016 by 0.9%.
Silverstein discusses how important the deal is to the state’s economy and then details some of the environmental concerns:
At the same time, environmental organizations are concerned that if the region became a hub for oil and gas enterprises, it would erode air and water quality. They point to the coal industry that has withdrawn from southern West Virginia and has left the land scarred and the people desperate.
But Silverstein sees a solution:
To that end, the state oversees the natural gas sector and could establish rules to ensure that much of the wealth remains at home while the drilling is done responsibly. The money could fund schools to educate workers about the oil and gas industry as well as those that teach science, engineering, technology and math. It’s about attracting more and more employers.
I consider Silverstein to be one of the best energy writers out there. On this one, however, I would suggest that he needs to do more reading in West Virginia history: the wealth has never stayed in the state just as the exploitation of the state’s natural resources has been a constant throughout its history. We have always been one of America’s richest states in resources, yet our citizens have consistently been among the country’s poorest. That’s not a coincidence and the pessimist/realist in me tells me that it won’t change even if the China deal works out.