JONATHAN D. EPSTEIN, BUFFALO NEWS, JULY 8, 2006
Industrial gas maker Praxair wants to renovate nearly 30,000 square feet of underused manufacturing space in Tonawanda to create a new engineering and design operation focused on meeting a sharp increase in U.S. demand for hydrogen and other gases.
The Danbury, Conn.-based company is seeking to form a new U.S. Project Execution Center in 28,430 square feet of existing space that officials said has been neglected. The company will convert the facility by year-end into modern office space for about 100 technical engineers, project managers, procurement professionals and others, said site manager Dennis A. Conroy.
The group’s mission will be to design and manage projects for new plants or pipelines, plant upgrades or pipeline expansions in the United States. It will not do research and development, Conroy said. The team will be separate from the company’s worldwide engineering group, but will be accessible to them.
About 75 of the employees will be transferred from worldwide operations, mostly within the local Technology Center plant, while 25 will be hired from outside.
“The beauty of this is we keep these jobs right here in Western New York,” Conroy said. “In a site that has a very rich history for Praxair, we’re bringing it up to its peak performance again.”
Praxair’s history in Western New York dates back to 1907, when Linde Air Products Co. was formed and built its first facility in Buffalo. The company, which also has a gas-separation plant in Niagara Falls, built the Tonawanda facility in 1937 to construct its three-story air separation units.
Linde was acquired by Union Carbide Corp., but was spun off as Praxair in 1992, when the company decided to shift the Tonawanda site to high-technology because the plant was no longer competitive for global manufacturing. Today, the Technology Center employs more than 1,100 workers in 25 buildings on 105 acres.
The expansion comes in response to a surge in demand for the gases Praxair produces. For many years, U.S. demand had slumped while attention was focused on international growth, but that’s changed because of high fuel prices and increased interest in hydrogen in particular.
In the past two years, the U.S. market has increased by at least 50 percent, and “that’s probably a very conservative number,” Conroy said. “It has increased substantially.”
Praxair is the largest provider of industrial gases in North and South America, and one of the largest worldwide, with 25,000 employees and operations in 40 countries. Its core products are atmospheric gases – nitrogen, oxygen and argon – but it also makes hydrogen, where the growth is concentrated. Acetylene and propane are other products.
Officials considered a variety of alternative locations, including in Houston, because of the proliferation of industrial gas there, but ultimately chose Tonawanda.
The company is working with the Erie County Industrial Development Agency to obtain $1 million to $1.5 million in sales tax exemptions to help the expansion. A public hearing is scheduled for Aug. 2 to solicit comment, and the board will consider the plan on Aug. 14.
“Praxair has a long history of corporate stewardship in the Buffalo community,” said Mike Conway, senior director of business finance for the IDA. “It’s important that we support Praxair, because it truly is the largest concentration of degreed employees in the private sector. We needed to put our best foot forward in order to encourage this investment.”
Besides basic renovation of the space, the firm also will buy and install new technology, communications and office infrastructure. And Conroy expects the project to have “domino” effects elsewhere in the overall plant, with realignments, rearrangements and upgrades for research, information technology and support services overall.
“You do an upgrade like this, and you feel the need to continue it and enhance it,” he said.
Work is already under way, with planning and design completed. Conroy said the project will be completed and operational by Dec. 31. “We are ready to get going,” he said.