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Is $100 Billion Worth of Spending All for Naught?

By Taylor Muckerman and Joel South - Mar 26, 2014 at 10:07AM

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Chemical companies are well prepared to take advantage of our natural gas boom, but will natural gas exports give these plans the cold shoulder?

You don't have to tell chemical manufacturers in the United States about the energy boom going on. They are all well aware, which is why, together, they have planned over $100 billion worth of expansion projects. Some are even going as far as to disassemble plants abroad and move them stateside. Both Nucor ( NUE -1.05% ) and Methanex Corp ( MEOH -4.35% ) targeted Louisiana as the ideal spot to relocate steel production and methanol production facilities to, respectively. 

These plans don't come cheaply, which is why many, such as Dow Chemical ( DOW ), have been outspoken against unchecked natural gas exports from the United States. We have already conditionally approved the exportation of up to 15% of our current demand, so further approvals could put us in a vise unless production begins to pick up again. Tune in to the short clip below for analysis on further implications for these companies.

This segment is from Tuesday's edition of "Digging for Value," in which sector analysts Joel South and Taylor Muckerman discuss energy and materials news with host Alison Southwick. The twice-weekly show can be viewed on Tuesdays and Thursdays. It can also be found on Twitter, along with our extended coverage of the energy & materials sectors @TMFEnergy.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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Stocks Mentioned

DuPont de Nemours, Inc. Stock Quote
DuPont de Nemours, Inc.
DOW
Nucor Corporation Stock Quote
Nucor Corporation
NUE
$112.81 (-1.05%) $-1.20
Methanex Corporation Stock Quote
Methanex Corporation
MEOH
$40.87 (-4.35%) $-1.86

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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