Shaw deals to create 2,900 jobs in La.

• By GARY PERILLOUX
• Advocate business writer
• Published: Aug 27, 2008 - Page: 1A - UPDATED: 12:05 a.m.

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The Shaw Group Inc. ended months of speculation about its nuclear power plans with a blockbuster announcement Tuesday: The engineering and construction firm will join Westinghouse Electric Co. in building a $100 million Lake Charles facility to make nuclear reactor components and, at the state’s urging, Shaw will keep its global headquarters in Baton Rouge for at least 15 more years.

The final tally will see Shaw and Westinghouse hire 1,400 people at a 300-acre Port of Lake Charles site by 2014.

In Baton Rouge, Shaw agrees to add a minimum of 150 new professional jobs every year through 2018.

That track would boost Shaw’s corporate staff in the state from 2,000 to 3,500 in the next decade. Its annual payroll in the state would grow from a current $260 million to $482 million.

Louisiana agreed to give Shaw $210 million in incentives to win the deal, with most of that being earned by Shaw along the way for hitting hiring and payroll targets in the next decade. The linchpin of the agreement was keeping Shaw’s headquarters in Baton Rouge through 2023.

Shaw also agreed to pay an average $50,000 a year plus benefits on the new jobs.

Stephen Moret, the Louisiana Economic Development secretary, said the state’s investment would be paid back within eight years, based on the deal struck with Shaw and Westinghouse. Those companies will jointly operate the Port of Lake Charles site as Global Modular Solutions LLC.

Shaw bought 20 percent of Westinghouse in late 2006 and the two companies are designing a next-generation reactor — called the Advanced Passive 1000, or AP 1000 — that’s being installed at four Chinese facilities. Dozens of nuclear reactors are expected to be built in the United States beginning in the next several years, and Westinghouse holds about a 60 percent share of the domestic reactor business and 50 percent of the global reactor business.

“We’re especially excited to welcome Westinghouse as a global player in Louisiana,” Gov. Bobby Jindal said of the Pittsburgh-based company. “Nuclear (power) provides clean, affordable energy that produces no carbon emissions. The opportunity for Louisiana is we will be seeing more of this work being done on a modular basis.”

The Shaw-Westinghouse deal essentially would create an entirely new industry in Louisiana, Jindal said.

Shaw Chairman Jim Bernhard said construction of nuclear reactors once took place entirely on site at nuclear power plants. But the Shaw-Westinghouse project will complete 25 percent of the building in Lake Charles, with the components to be shipped by barge to nuclear job sites.

In July, Bernhard said his company would gross about $2 billion to $2.5 billion per reactor, with the installed price for reactors running about $4.5 billion to $5 billion. Shaw already has deals for a pair of reactors in Georgia, two more in South Carolina and likely two others in Florida, making the Southeast a good place to begin building reactor components in late 2009.

But Bernhard said the facility coming to Lake Charles could have gone anywhere in the world. The company he founded in 1987 and grew from three people to 27,000 employees has much invested in the state already.