Economic Impact

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    NEXUS Awards Contracts to Build Pipeline – Union & Non-Union Labor

    NEXUS map
    NEXUS map – click for larger version

    Spectra Energy has awarded four contracts to three companies to build the NEXUS Pipeline–a $2 billion, 255-mile interstate pipeline that will run from Ohio through Michigan and eventually to the Dawn Hub in Ontario, Canada. Two of the three companies will use union labor, the third will not–and that’s causing some pushback from labor groups in Ohio. A NEXUS rep said that 79% of the pipeline will be built by union labor. Labor unions would prefer that percentage be 100. Spectra/NEXUS guaranteed at least 50% of the labor would be union–so the contracts far exceed their promise. A dollar figure was not released for the work. Here’s who got the work to build NEXUS…
    Read More “NEXUS Awards Contracts to Build Pipeline – Union & Non-Union Labor”

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    How Republican Tom Corbett Convinced Shell to Locate Cracker in PA

    Gov-Tom-Corbett.jpg
    Former Gov. Tom Corbett

    There’s no question that Tom Corbett was ten times the governor that Tom Wolf is now. Wolf is an undisputed disaster. Good thing Corbett is the one who brokered the deal to get Shell to select Pennsylvania as the location for its multi-billion dollar ethane cracker plant. A big tax incentive helped lure Shell to the Keystone State, no question about it. But that’s not the only reason the company decided on PA. When it comes to business and sales, there are a couple of tried-and-true axioms. One of those axioms is that people do business with people–not companies. Another is this: people buy from people they know, like and trust. Take any one of those elements away, and you don’t make a sale. So how did Tom Corbett “sell” Shell on PA as the location? There were a number of factors, but one way that stands out as a shining example: Corbett treated the Shell execs to a Pittsburgh Steelers game…
    Read More “How Republican Tom Corbett Convinced Shell to Locate Cracker in PA”

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    Shell Cracker Plant Will Spur Real Estate Deals 150 Miles Away

    Shell ChemicalsGentlemen, start your engines! Your economic engines, that is. The news earlier this week that Shell has made the commitment to move ahead and build an ethane cracker plant in Monaca, PA has, as we knew it would, set the region buzzing (see Breaking: Shell Pulls the Trigger, PA Ethane Cracker is a Go! and Shell PA Cracker Plant Project a Lot Bigger Than First Thought). With the decision now made, those in the real estate community are salivating over how that decision will reverberate throughout the region. There is now an effort underway to lure manufacturers in Texas and along the Gulf Coast area to consider setting up in the western PA (and eastern OH and northern WV) area instead–to take advantage of being that much closer to the biggest market in the country–the East Coast. One real estate pro says commercial real estate for up to 150 miles away is likely to be impacted by the decision to build the cracker plant in Monaca…
    Read More “Shell Cracker Plant Will Spur Real Estate Deals 150 Miles Away”

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    Shell PA Cracker Plant Project a Lot Bigger Than First Thought

    Artist's rendering of Shell Monaca Ethane Complex
    Artist’s rendering of Shell Monaca Ethane Complex – click for larger version

    Yesterday MDN was one of the first to bring you the fantastic news that Shell has decided to move forward with building their multi-billion dollar ethane cracker plant (see Breaking: Shell Pulls the Trigger, PA Ethane Cracker is a Go!). Shell mentioned their positive final investment decision (FID) as part of a larger, wide-ranging announcement on their plans for the next few years and beyond. They were slow off the mark, but Shell finally issued a separate press release about the FID for the Monaca, PA ethane cracker plant complex. As usually happens with a story this big, more details have come out after the initial announcement. For example: Shell’s initial estimate for the cost of the project, more than four years ago, was “$2-$3 billion.” Now? They won’t say. But some news sources are reporting it will be closer to a $6 billion investment. One even goes as high as $11 billion! What Shell *is* saying is that construction on the main part of the facility will begin in 18 months, with production expected to flow beginning “early in the next decade”–which we take to mean sometime around 2020 or 2021. Shell says the project will provide work for 6,000 temporary construction workers while it’s being built, and 600 permanent, full-time employees to operate the facility once it is built. Needless to say, local economic and government leaders in the Pittsburgh region are ecstatic with the news. Here’s more details about the Shell ethane cracker coming to PA, along with select reaction and comments…
    Read More “Shell PA Cracker Plant Project a Lot Bigger Than First Thought”

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    WVU Researcher Says Marcellus/Utica Needs an Ethane Storage Hub

    WVU logoForget about a cracker plant in West Virginia. Well, not really–just put it on the back burner for the moment. A researcher from West Virginia University says what the Mountain State and indeed all of Appalachia really needs is ethane storage. Specifically, an ethane storage hub. According to Brian Anderson, director of West Virginia University’s Energy Institute, without ethane storage (and pipelines) the Marcellus/Utica region risks seeing its abundant ethane leave the area, mostly heading to the Gulf Coast. Why is that bad? Because if we can keep ethane in the area, we will attract manufacturers to the region who want to use the results of that ethane–ethylene, the raw material in plastics. Our region can realize a bonanza in manufacturing jobs and investments–if we can store and use the ethane here, at home…
    Read More “WVU Researcher Says Marcellus/Utica Needs an Ethane Storage Hub”

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    Fitch: Drillers Continue to Default on Bonds – It Ain’t Over Yet

    Fitch RatingsIn the past 12 months, some 27% of all E&Ps (exploration and production companies, what we call “drillers”) have defaulted on some of their bonds–the debt they owe. That’s huge. According to Fitch Ratings, before we turn the corner, they expect that number to grow to 30-35% of E&Ps. Defaulting on bonds doesn’t necessarily mean a company has filed for bankruptcy, but a plethora of bankruptcies have, according to Fitch, driven the bond default number way up. Here’s the latest on bond defaults and the sentiment that “it’s going to get worse before it gets better” from Fitch…
    Read More “Fitch: Drillers Continue to Default on Bonds – It Ain’t Over Yet”

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    Duke U Study: Local Governments Benefit from Shale Drilling

    Duke logoNew research from the once-great Duke University actually supports shale drilling for a change–instead of denigrating it. In the past researchers from Duke, using money from the odious Park Foundation, have been bought off in their research efforts. This latest research, which concentrates on the benefits to local governments from shale drilling, wasn’t funded by Park and appears to be objective for a change. Two Duke U researchers conducted a three-year research project (between 2013-2015) funded by the Alfred P. Sloan Foundation. They traveled far and wide, to 16 states and interviewed over 200 local government officials along with gathering data and facts. The conclusion: on balance oil and gas drilling benefit local communities…
    Read More “Duke U Study: Local Governments Benefit from Shale Drilling”

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    Gov Cuomo Turns NY into Sacrifice Zone with Frack & Pipeline Bans

    Karen Moreau
    Karen Moreau

    Yesterday API (American Petroleum Institute) New York Executive Director Karen Moreau held a conference call with reporters to discuss the importance of investing in energy infrastructure in the Empire State. By the way, API New York used to be called the API New York State Petroleum Council. Moreau spoke about Gov. Cuomo’s reckless actions in banning shale drilling, and now in preventing an important pipeline project–the Constitution–from being built. She pointed out that New Yorkers pay an average of 50% more for our electricity than residents in other states–mostly because of lack of pipelines and infrastructure in the state. When everyone thought Cuomo was about to allow fracking in select counties on a trial basis, antis called those counties “sacrifice zones.” We’re going to borrow their own language and use it against them. Gov. Cuomo has turned upstate NY into one, big economic sacrifice zone–sentencing residents to a life of poverty and enslavement. Why? To appease the people who vote him into office every four years (mostly located in New York City). A quid pro quo. Here’s an update on what Moreau said yesterday to reporters…
    Read More “Gov Cuomo Turns NY into Sacrifice Zone with Frack & Pipeline Bans”

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    New Study Proves Shale Gas has Big Impact on Manufacturing Sector

    NAM logoEverybody knows, anecdotally, that the shale revolution has been great for U.S. manufacturers. Empty plants have roared back to life and new plants have been built, bringing back millions of jobs, due to the huge quantities of natural gas being extracted from shale in the U.S. Now we have a research study to prove what we already knew anecdotally. Yesterday the National Association of Manufacturers (NAM) released a new research report from IHS titled “Energizing Manufacturing: Natural Gas and Economic Growth” (full copy below). The research finds that shale gas has put an extra $1,337 back in the pockets of the average hard-working American family. Wow! Shale gas has also contributed to the creation of 1.9 million jobs throughout the economy. Double wow! Just building natural gas transmission lines has meant more than 347,000 jobs with 60,000 of those jobs in manufacturing. Here’s the best part: All of it is without a government program or taxpayer expense. Read on for more good news about how the shale revolution and the miracle of fracking has benefited every single American…
    Read More “New Study Proves Shale Gas has Big Impact on Manufacturing Sector”

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    Constitution Pipe Denial May Destroy 2K Existing Upstate NY Jobs

    Raymond forkliftNew York Gov. Andrew Cuomo’s action to stop progress on the Constitution Pipeline has very real, tangible negative effects on jobs in Upstate New York. This is the true story of two large regional employers in New York’s Southern Tier that would benefit from cheap, abundant, and clean-burning Marcellus Shale gas from northeastern Pennsylvania. Wait. You believed the anti’s lie that all of the gas traveling through the Constitution would be transported to other areas, with much of it exported, and would not in any way benefit local residents? Yeah, that’s a lie. Another 100% lie pedaled by irrational fossil fuel haters. As the Constitution crosses places like Broome, Chenango and Delaware counties in the Southern Tier of New York State (i.e. “Upstate”), the pipeline will be tapped in several locations by Leatherstocking Gas Co.–a small but important local utility company. Leatherstocking will then provide gas to area communities and to two large businesses. One of those businesses is the Amphenol Aerospace plant in Sidney, NY. Amphenol is the largest employer in Delaware County with some 1,100 employees. Amphenol needs cheap Marcellus Shale gas from the Constitution to stay competitive and to keep the plant open. The second business is located in the small Chenango County village of Greene–Raymond Corporation. You know those bright red-colored forklifts you see in warehouses and factories? They’re all built at Raymond, which ships them worldwide. The facility is now owned by Toyota. Raymond also needs natural gas from the Constitution Pipeline. With over 800 1,600 employees at Raymond, it is the third largest employer in Chenango County. Does Gov. Cuomo really want to play Russian roulette with nearly 2,000 upstate jobs? Here’s the sad story of a corrupt governor bowing to political pressure and screwing his own constituents in Upstate…
    Read More “Constitution Pipe Denial May Destroy 2K Existing Upstate NY Jobs”

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    WV Gov Tomblin Woos Japanese to Invest in State’s NatGas Industry

    WV Gov. Earl Ray Tomblin
    WV Gov. Earl Ray Tomblin

    In 2013 West Virginia Gov. Earl Ray Tomblin wooed the Brazilians into investigating and hopefully building a multi-billion dollar ethane cracker in his state (see WV Announces Brazilian Company to Build Ethane Cracker Complex). Odebrecht was supposed to build an ethane cracker near Parkersburg, WV’s third largest city. But then the bottom fell out of the market and Odebrecht’s plans have been shelved (see Odebrecht Pushes the Pause Button on WV Ethane Cracker). We won’t say the project is dead, but there haven’t been any brainwaves in months and the only thing keeping it alive is a respirator. Is that wily WV governor at it again? Last week Tomblin hosted a delegation from Japan, attempting to woo them into exploring “new investment opportunities in natural gas statewide.” What does that mean, exactly? Presentations were delivered by MarkWest and others. MarkWest has several natgas processing and NGL fractionation plants in the state. We know we’re reading between the lines here, but it sure sounds to us like Tomblin is trying to find someone else willing to build a cracker plant in the state…
    Read More “WV Gov Tomblin Woos Japanese to Invest in State’s NatGas Industry”

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    Construction Begins on $780M SWPA NatGas-Fired Power Plant

    Tenaska Westmoreland Generating Station
    Tenaska Westmoreland Generating Station – artist rendering

    “It’s a go” for a long-delayed $780 million natural gas-fueled power plant in South Huntingdon (Westmoreland County), PA being built by energy giant Tenaska. So said a Tenaska spokesperson following an announcement that the Tenaska Westmoreland Generating Station, a 925-megawatt (MW) natural gas-fueled power plant project near Pittsburgh, has secured $780 million in funding. The project was first proposed in 2009 and since that time has secured all of the necessary permits. The project has also faced some local opposition. According to the Tenaska announcement, construction began “earlier this year” at the project site. Black & Veatch is doing the engineering work and acting as the contractor for the project. And yes, Marcellus/Utica gas will feed the plant when it goes online in 2018…
    Read More “Construction Begins on $780M SWPA NatGas-Fired Power Plant”

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    PA Biz Affected by Drilling Slowdown, but Hope is on the Horizon

    Don't Stop BelievinYesterday MDN told you the sad news that southwest PA hotel owners have hit a rough patch and some of them are putting their properties on the auction block (see SWPA Hotel Owners Catering to Marcellus Auctions Properties). We have more news today about businesses being adversely affected by the drilling slowdown in PA. This time the stories come from the eastern part of the state. And yes, once again one of the affected businesses is a motel. And also a cleaning service. Even though “it’s tough and getting tougher out there” as well all know, we also spotted a story of hope. George Stark, spokesman for Cabot Oil & Gas, says shale drilling WILL return to PA, and it will return “with a vengeance.” What does that mean?…
    Read More “PA Biz Affected by Drilling Slowdown, but Hope is on the Horizon”

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    Shell has Spent “Half a Billion Dollars” on PA Cracker Already!

    money-bag.jpgThe Pittsburgh Business Times hosted an event yesterday in Beaver County, PA–the place where Shell is spending money to explore whether or not to build an ethane cracker plant. Seems like we’ve been writing about Shell’s potential ethane cracker forever. We’ve chronicled just about every up and down. We’ve also highlighted various initiatives they’ve undertaken since announcing Monaca, PA as their chosen site–something they did back in March 2012, now four years ago (see Shell Announces Location of Ethane Cracker Plant). Since that time Shell has purchased the property where they want to build the plant; they’re building a bridge and roads to the plant site; they’ve leased office space near the plant site. They’ve done a whole lot more. What we didn’t realize is that when you add it all together, according to Pat Nardelli, a partner at Castlebrook Development and speaker at the PBT event, Shell has spent “half billion to date if not more, and it’s going up every day.” Yikes! In this economy nobody blows a half bil on something they just decide to walk away from…
    Read More “Shell has Spent “Half a Billion Dollars” on PA Cracker Already!”

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    U.S. Chemical Industry Investment Linked to Shale Gas Tops $164B!

    The American Chemistry Council (ACC) participated in a Hudson Institute event yesterday. During a presentation made by the ACC, they announced that U.S. chemical industry investment linked to plentiful and affordable natural gas and natural gas liquids (NGLs) from shale formations has reached an astonishing $164 billion. Some 40% of that investment is for the 264 projects – new facilities, expansions and factory re-starts – that is either completed or underway. Another 55% are for projects in the planning phase. This is a big deal folks. ACC’s research shows the investments tied to shale will lead to $105 billion per year in new chemical industry output and support 738,000 permanent new jobs across the U.S. economy by 2023–including 69,000 new chemical industry jobs, 357,000 jobs in supplier industries and 312,000 jobs in communities where workers spend their wages. Below we have a variety of resources for you. We have the ACC announcement with many interesting facts and figures. We also have a fact sheet summarizing their research, a copy of the slide deck used for the presentation (with really cool slides), and a copy of a study the ACC published in 2013 with a list of the companies who, at that time, had announced major downstream projects using shale-related natural gas and liquids…
    Read More “U.S. Chemical Industry Investment Linked to Shale Gas Tops $164B!”

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    Philly Chamber Publishes Roadmap to Turn Region into “Energy Hub”

    Yesterday a large group of business, labor and political leaders gathered in Philadelphia to hear about plans to turn Philly into an “energy hub” with more pipelines delivering natural gas and natural gas liquids to the region. Chemical plants and manufacturers would spring up to use the gas and gas liquids–creating a huge economic impact for the region. According to press reports there were 200 or more gathered for the unveiling of a new report from the Greater Philadelphia Chamber of Commerce’s Greater Philadelphia Energy Action Team (GPEAT). The report is titled, “A Pipeline for Growth, Fueling Economic Revitalization with Marcellus and Utica Shale Gas” (full copy embedded below). Meanwhile, 20-30 silly anti-drillers (who don’t have lives apart from protesting) stood outside and tried their darnedest to shout and disrupt the meeting. How did they react inside? By making fun and laughing at them! Philip Rinaldi, GPEAT Chair and President/CEO of Philadelphia Energy Solutions said this to the crowd as he took the stage: “I’m inclined to ask for a brief moment of silence to hear the protesters a little better.” Love it! You had to have a ticket into the private event–and the antis couldn’t score any tickets to disrupt the event–something they bitterly complained about. We say it’s about time someone pushed back against these disorderly ne’er do wells. Here’s how it went down inside the event, a place the antis couldn’t go…
    Read More “Philly Chamber Publishes Roadmap to Turn Region into “Energy Hub””