States Hardest Hit by COVID-19 Have $5 Billion in Projects at Risk
Researched by Industrial Info Resources
As COVID-19 continues its deadly trek throughout the U.S., some states are seeing a dramatically higher number of reported cases than others. Three states accounted for roughly half of all reported infections nationwide: New York, New Jersey and Michigan, according to the U.S. Centers for Disease Control (CDC). Industrial Info is tracking about $5 billion worth of active projects in these three states that have been delayed or otherwise affected by COVID-19, including high-value developments in their iconic power-generation and steel-manufacturing markets.
By far the largest project, in terms of investment value, that has been pushed back is Cree Incorporated's (Durham, North Carolina) $1 billion "North Fab" silicon carbide wafer plant in Marcy, New York, which began site preparation in February but has had its full construction kickoff delayed until at least August. The facility will produce a type of semiconductor that can operate at high temperatures for the automotive, communications and industrial markets.
The tech industry has seen a variety of big-ticket projects across the U.S. put on hold due to COVID-19 concerns, with Facebook Incorporated (NASDAQ:FB) (Menlo Park, California) and Microsoft Corporation (NASDAQ:MSFT) (Redmond, Washington) delaying at least two major data-center construction projects in the heartland. For more information, see April 3, 2020, article - Phillips 66, Shell, Toyota, Facebook, Microsoft Add to List of Projects Delayed by COVID-19.
Although mining has been deemed an "essential" business that can remain operational during the COVID-19 outbreak, Cargill Incorporated (Minnetonka, Minnesota) has halted all surface work at its $42 million Shaft No. 4 addition at the Cayuga Rock Salt Mine in Lansing, New York. The project--which began construction in October 2018, but had its estimated completion date pushed back from August to December--is designed to extend the mine life of the 2 million-ton-per-year underground operation. All work not directly related to the ongoing shaft drilling, shaft lining and environmental systems has been suspended.
The State University of New York at Buffalo was hoping to begin construction later this summer on an estimated $86 million in solar array additions across the North, South and Downtown campuses that would generate a total of 50 megawatts (MW) for the university. The projected completion date has been pushed back from May 2021 to August 2021. The North Campus already is home to the "Solar Strand," the largest solar installation on a New York state campus and one of the largest on any U.S. campus.
The University of Michigan is hitting the pause button on one of its own power-generation projects: an $80 million gas turbine addition at the Ann Arbor Campus' Central Power Plant, which is designed to add 15 MW of generation to the facility. Construction kicked off last July and was set to wrap up in December 2021; it is currently unknown if the completion date will change.
Michigan is renowned for its contribution to the steel-manufacturing sector, and two of its top steel producers are among those delaying projects. Cleveland-Cliffs Incorporated (NYSE:CLF) (Cleveland, Ohio) had delayed indefinitely the estimated $75 million rebuild of a major blast furnace at its steel works plant in Dearborn, while Gerdau Special Steel North America, a subsidiary of Gerdau S.A. (NYSE:GGB) (Sao Paulo, Brazil), has halted construction on an estimated $70.3 million electric arc furnace at its steel minimill in Monroe. Sharply declining steel demand, particularly from the automotive sector, forced Gerdau to idle its minimill in Monroe altogether.
Although New Jersey trailed only New York in its total COVID-19 diagnoses, among these three states it has seen the smallest amount of investment affected by the outbreak. One of those, however, is a key project in New Jersey's push for greener energy: TopSail Energy LP's (The Woodlands, Texas) $75 million used oil-processing facility in Pennsauken, which is designed to re-purpose 3,000 barrels per day of used motor oil into marketable feedstocks, fuels and additives. It was expected to begin construction this month, but the kickoff has been pushed back to June at the earliest.
For more information, contact Lauren Boyd at [email protected]