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Map of Sorrento, Louisiana

Royal Dutch Shell PLC selected Ascension Parish, Louisiana as a potential location for a $12.5 billion gas-to-liquids (GTL) facility.

If Louisiana is the final pick, the plant will be be located near Sorrento, and would also be one of the first commercial-scale plants of its kind in the U.S.

According to an incentive agreement with the state, the project would create 740 direct jobs.

A decision whether to begin construction of the facility is pending several years of site evaluation and preliminary engineering studies, according to Shell.

Selecting a site is an important step that allows us to conduct more detailed planning, technical analysis, and begin the permitting process, said Executive Vice-President Jorge Santos Silva, who directs integrated gas activities for Shell Upstream Americas. Should we move forward with the project, we expect project costs to be well in excess of the minimum spend that was agreed upon with the state of Louisiana, he added.

Shell would also invest an estimated $32 million in road improvements to alleviate traffic accompanying the construction and operation of the facility.

The State of Louisiana would reimburse Shell for costs related to necessary public road improvements, land acquisition, and other infrastructure costs with a performance-based grant of $112 million included in the incentive package.

This news comes in the wake of Shell’s announcement that it’s dropping all operations in Kansas.