UPDATE: 4/19/2012, 3:14 p.m. EDT

Dow Chemical Co. (IW 500/22)
CEO Andrew Liveris said Thursday shale gas could drive a new manufacturing sector in the United States if the nation adopts an energy policy that includes "smart regulation."

Liveris made his remarks at a gathering in Texas to formally announce the company's intent to build a world-scale ethylene plant and herbicide production facility at its Freeport, Texas, complex.

The ethylene facility, scheduled to begin production in 2017, is part of a $4 billion expansion effort in the Gulf region to take advantage of abundant shale gas resources.

The company expects the plant to employ as many as 2,000 workers during the construction phase.

Midland, Mich.-based Dow Chemical also plans to build a new herbicides plant in Freeport as part of the company's transformational strategy to invest downstream in performance and derivative products, said Earl Shipp, vice president and site director for Dow Texas Operations.

The facility will produce the company's Enlist weed-control system, said Kenda Resler-Friend, a spokesperson for Dow AgroSciences. Enlist is a type of weed control specifically designed for herbicide-resistant weeds.

The product is currently undergoing the regulatory review process, Resler-Friend said.

Shale Gas Advantage

The company is one of several chemical producers that plans to take advantage of growing natural gas resources in the United States by building new complexes near shale gas regions.

Liveris referred to shale gas as a "gift" and a "miracle" during his remarks at the gathering, which included speeches by Texas Gov. Rick Perry and other government officials.

But failure to enact an energy policy that addresses security concerns including potential natural gas exports could hamper future manufacturing growth, Liveris said.

However, natural gas holds significant potential as an export in solid form, including its use as a feedstock for chemicals, paper and steel, Liveris said.

Liveris, who also serves as co-chair of President Obama's Advanced Manufacturing Partnership, credited Texas' business-friendly incentives as a "deal maker" in the company's decision to locate in the state.

He referred to the state as a model for other governments seeking new investments.

"I know when I get a red carpet and when I get red tape, and I get a red carpet when I'm in the state of Texas," Liveris said.

Dow Chemical is taking advantage of the Texas Enterprise Fund, which the state awards to companies based on several job-creation factors.

See also:

Dow Chemical's Recipe for Competitiveness and Innovation