Marcellus Drillers Look for Partners to Supply Products/Services

supply chain The Altoona-Blair County Development Corp. (ABCD) and the Blair County Chamber of Commerce partnered to host a seminar yesterday to help local businesses get a piece of the natural gas industry pie—or “plug into the supply chain” as it’s commonly referred to. The seminar was aimed at helping companies find business opportunities in the Marcellus Shale drilling industry, and although it was aimed at businesses in south central PA, the information shared will help businesses throughout the Marcellus/Utica region.

According to speakers at the seminar, one driller in particular who is new to the Marcellus is looking for business partners in the Marcellus to provide them with products and services. Who is that driller and whom should you talk to there? What types of businesses stand a good chance of getting business in the shale drilling industry? And where, geographically, are the best opportunities in PA? Read on…

Jim Ladlee, associate director of the Penn State Marcellus Center for Outreach and Research…[noted] there are exploratory activities under way in Pennsylvania in five different shale formations [with the Marcellus being the most active].

Most of the drilling in Pennsylvania is in Lycoming, Bradford, Susquehanna and Tioga counties in the northern tier and Washington and Greene counties in the southwestern corner of the state.

"Seventy-three percent of drilling since 2008 has occurred in those six counties," Ladlee said.

Chevron Corp., which in 2011 purchased 228,000 acres from Chief Oil & Gas LLC and Tug Hill Inc., including wells in Blair, Bedford and Cambria counties, is looking for local businesses to become part of their supply chain, said Drew Cowley, procurement operations manager.

"This area is new to us. We don’t have a lot of business partners in this area and we need some. We want to find a way you can help us and we can help you and grow your business," Cowley said. "We are looking for companies that provide high quality goods and services."

Numerous opportunities exist in the predrilling and drilling and completion phases, Ladlee said.

For example, predrilling opportunities include companies who make portable toilets for job sites, pad liners and water tanks. In the drilling and completion phases, opportunities exist for pipefitters, pipe manufacturers, financial services, hotels, restaurants, bankers, real estate people, safety equipment manufacturers and more, Ladlee said.

Companies need to be patient but persistent in order to become suppliers for the shale gas industry, he said.*

*Altoona (PA) Mirror (Jan 23, 2013) – ABCD, chamber host gas seminar

Let’s summarize:

  • If your business offers products or services related to portable toilets, pad liners, water tanks, pipes (fitting and manufacturing), financial services (including banks), hotels, restaurants, real estate, safety equipment, “and more,” you stand a good chance of selling your services to the drilling industry.
  • If your business is one of the types mentioned above and is located (or does business) in and around Lycoming, Bradford, Susquehanna, Tioga, Washington or Greene counties in PA, you stand a good chance of selling your services to the drilling industry. However, businesses in other counties can and are successful in selling to the industry as well.
  • If your business is one of the types mentioned above and is located in and around Blair, Bedford and Cambria counties, you stand a good chance of doing business with Chevron, who is looking for suppliers. In particular, you need to talk with Drew Cowley, procurement operations manager for Chevron out of their Moon Township (Pittsburgh) office. MDN has researched Cowley’s contact information and includes it below.

Perhaps the key piece of information in the article quoted above is this statement: “Companies need to be patient but persistent in order to become suppliers for the shale gas industry.” Very true!

Even if you know who’s looking (Chevron), whom to talk to (Cowley) and what they’re looking for, you still have hoops to jump through. MDN is told by supply chain experts that you need to get your company on a drillers’ “approved vendor list.” But even if you get on that list, which is a process, you still need to network and make connections and look for that first opportunity to prove your business can deliver—and when that opportunity arrives, you need to ensure your company does an outstanding job. That’s how you’ll get repeat business.

In other words, the Marcellus Shale supply chain business is real, it’s profitable and it’s there, but like any business opportunity, it takes hard work and persistence to make it happen.

Here’s Drew Cowley’s contact information for eager beaver companies in central PA who want a piece of the Marcellus Shale supply chain pie:

Chevron N.A. E&P Co.
Appalachian/Michigan Business Unit
Physical: 1550 Coraopolis Heights Rd, 2nd Fl, Moon Township, PA 15108
Mail: PO Box 611, Moon Township, PA 15108
800-251-0171 (f) 412-262-2820
Drew Cowley, Procurement Operations Manager, [email protected]