Economic Impact

Economic Impact | Industrywide Issues | Lackawanna County | Luzerne County | Pennsylvania

More Marcellus Airline Capacity Coming to NEPA from Delta
February 28, 2014February 28, 2014

We recently told you the story of why United Airlines was eliminating a daily flight between Cleveland and Oklahoma City, a move that may have an impact on Utica Shale development (see The Reason United Canceled Daily Flights Between Cleveland & OKC). Here’s a story on the other side of the isle: Delta is increasing the capacity of the jet it runs between the Wilkes-Barre/Scranton International Airport and Atlanta’s Hartsfield-Jackson International Airport. They’re going from a small regional 50-seater jet to an Airbus A319 which seats up to 156 passengers.

Some (many?) who work in the gas fields of northeast PA use the Atlanta connection to reach Wilkes-Barre/Scranton, so this good news means there’s more development opportunity for the Marcellus because more people can reach it faster from places like Texas and Oklahoma, where many PA drillers have their headquarters…
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Braskem | Economic Impact | Energy Services | Ethane | Industrywide Issues | Jobs | Odebrecht | Processing Plants | Research | Statewide WV | West Virginia | Wood County

Economist Releases Report on WV Cracker Plant’s Economic Impact
February 26, 2014February 26, 2014

West Virginia’s coming ethane cracker plant continues to generate positive economic news. Yesterday the former director of West Virginia University’s Bureau of Business and Economic Research and professor emeritus at WVU, Tom Witt, released a study he conducted on behalf of Braskem America (i.e. Odebrecht, the company building the cracker). The new study details specifics for how many jobs and how much money the proposed cracker and associated petrochemical plants will generate. And it’s truly astonishing.

Here’s an overview of the economic miracle about to hit WV (and beyond)…
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Economic Impact | Hydraulic Fracturing | Industrialization | Industrywide Issues | Jobs | Ohio | Public Opinion | Research | Statewide OH | Utica Shale

Survey Says! OU Survey of Local OH Officials on Utica’s Impacts
February 26, 2014February 26, 2014

Two days ago the Ohio University Voinovich School of Leadership and Public Affairs released the findings of its much anticipated Ohio Shale Development Community Impact Survey. During summer of 2013, the Voinovich School distributed more than 500 surveys to local elected officials across 17 counties experiencing the majority of shale activity and development in Ohio. The survey assesses the impact of shale development within 17 counties in eastern Ohio, with a focus on population, housing, public safety, infrastructure, environment, local employment, area business activity, and economic development. Some 200 of those surveys were returned and the data tabulated.

What did the survey find? Ohio’s local elected officials say Utica Shale drilling has caused an marked increase in jobs and the occupancy rate at hotels. But Utica drilling has also caused some pollution issues and a big increase in the demand for water supplies. This is a very interesting study (full copy embedded below)…
Read More “Survey Says! OU Survey of Local OH Officials on Utica’s Impacts”
Allegheny County | Economic Impact | Industrywide Issues | Pennsylvania | Supply Chain

Pittsburgh Co Figures Out How to Tap Marcellus Supply Chain
February 24, 2014February 24, 2014

The article below is of the kind that fascinates MDN. It’s about a small tool and die manufacturer in Pittsburgh chasing new business in the Marcellus (and Utica) Shale industry. There are some important lessons learned by the manufacturer: it’s not easy and it’s not quick to plug in to the Marcellus supply chain. Certifications make it easier–but depending on the cert, it costs big money and takes time. Bottom line: There is no quick and easy route to getting your piece of the Marcellus pie. You’re going to have to work and work hard–but then, that’s the way business has always been!

Here’s an instructive tale of hope, determination and ultimately success in plugging in to the Marcellus supply chain:
Read More “Pittsburgh Co Figures Out How to Tap Marcellus Supply Chain”
Economic Impact | Industrywide Issues | Jobs | Processing Plants

ACC Says $100B of New Shale-Related Petrochemical Spending on Way
February 24, 2014February 24, 2014

The American Chemistry Council trade group last week announced that shale gas in the U.S. is having an incredible economic impact on the chemical industry. According to the ACC, who keeps track of these things, 148 shale-related chemical industry projects, valued at $100.2 billion, have been announced–so far. These projects include new factories, expansions and process changes to increase capacity. The ACC says the new spending could lead to $81 billion per year in new chemical industry output and 637,000 permanent new jobs by 2023. Astonishing. More than half of the investment is by firms based outside the United States.

Here’s the ACC announcement from last week:
Read More “ACC Says $100B of New Shale-Related Petrochemical Spending on Way”
Beaver County | Economic Impact | Energy Companies | Ethane | Industrywide Issues | Jobs | Pennsylvania | Processing Plants | Shell

Beaver County, PA – In the Marcellus/Utica Catbird Seat
February 21, 2014February 21, 2014

In many ways, Beaver County, PA is in the catbird seat with respect to the Marcellus and Utica Shale. The county has seen some Marcellus drilling with 17 unique well permits were issued for Beaver for the last four months of 2013 according to the latest volume of the Marcellus and Utica Shale Databook. However, it is Beaver’s geography for reasons other than drilling that gives it its advantage: the Ohio River flows through Beaver; two interstate highways pass through; lots of railroads; and of course, close to the Pittsburgh International Airport.

Beaver is also the chosen location for Shell and their $2-$3 billion ethane cracker plant. It’s been a roller coaster of will they or won’t they build it? Lately, it certainly seems like Shell is favoring a green light for the project–but only when they finally buy the property on which a now closed zinc plant sits will everyone breath a sigh of relief that the project is a done deal. (See Shell to Begin Demolition at PA Ethane Cracker Site Early 2014 for the latest.) Even if Shell doesn’t build the cracker plant, Beaver County officials say there’s still a lot happening in the county and the future looks bright, because of the Marcellus…
Read More “Beaver County, PA – In the Marcellus/Utica Catbird Seat”
Economic Impact | Industrywide Issues | Pennsylvania | Susquehanna County

PA Rural Residents Burn Marcellus Gas, Save Big Bucks on Heating
February 11, 2014February 11, 2014

One of the conundrums of shale gas drilling in the Marcellus and Utica Shale is that the places where the gas is drilled and extracted are largely rural–places like Susquehanna County, PA, in the northeastern part of the state. The entire county has 43,000 residents (11,700 families). The largest “city” in Susquehanna County is the county seat of Montrose, population 1,600 (750 households). It’s just not all that economical to run natural gas pipelines to homes around the county–even though residents live atop an embarrassing riches of natural gas. One company, Leatherstocking Natural Gas, changed all that last year when they started to run pipelines to residences and businesses around Montrose.

This winter, one local business owner (an auto mechanic’s shop) now heating with natural gas, responded to his new fuel source this way: “Before when you were here, you asked if I was going to save money [by heating with natural gas]. I said ‘I sure as hell hope so.’ Well, I sure as hell am, let me tell you.” That about sums up the change from heating with oil to heating with home-grown, cheap and abundant Marcellus shale gas…
Read More “PA Rural Residents Burn Marcellus Gas, Save Big Bucks on Heating”
Broome County | Economic Impact | Industrywide Issues | Jobs | New York | Pennsylvania | Statewide NY | Statewide PA

PA’s Long-Lived Marcellus Renaissance Can’t be Denied, Even by NY
February 10, 2014February 10, 2014

Judging by the stories we’re now seeing, must be Gov. Cuomo’s internal poll numbers are a lot worse than we thought. So bad that his buddies at Gannett need to try and prop him up by rewriting current history. Get this, the headline for a story in the Binghamton Press & Sun-Bulletin actually attempts to make the claim that the economic miracle happening right across our border in PA…isn’t actually happening! Talk about chutzpah. “Pay no attention to all of those jobs–all of that money–all of the new tax revenue. None of it’s real. It’s all a flash in the pan. Here today, gone tomorrow.”

Wow. We guess you can fool some of the people all of the time, going by the PSB’s propaganda…
Read More “PA’s Long-Lived Marcellus Renaissance Can’t be Denied, Even by NY”
Economic Impact | Energy Companies | Industrywide Issues | Monroe County | Ohio | Taxation | Triad Hunter | Utica Shale

Utica Shale Bails Monroe County out of Potential Hole
February 10, 2014February 10, 2014

Ormet, an aluminum plant in Hannibal (Monroe County), OH is the county’s largest employer with 700 people working at the plant. Ormet officials shut the plant down last October claiming they couldn’t get a reasonable agreement on reducing high electric rates for the plant. That’s 700 people out on the street, looking for jobs (see Ormet Workers Rally At AEP). But what’s this? Monroe County Auditor Pandora Neuhart and County Treasurer Judy Gramlich are not worried about sales tax revenues in the county taking a hit from all of those unemployed workers. Why? Because Utica Shale drilling has taken off in the county and tax revenues from drilling are starting to flow in.

New Utica drilling revenue is not jump-up-and-down good news for the displaced Ormet workers (that situation needs urgent attention by Gov. Kasich), but the new Utica revenue is a good sign that regular county operations will not be adversely affected by the Ormet layoffs. Thank you Utica Shale! An update on Utica drilling in Monroe County, and how the now bankrupt Ormet is profiting from it (with wells on their property)…
Read More “Utica Shale Bails Monroe County out of Potential Hole”
Economic Impact | Energy Services | Industrywide Issues | MarkWest Energy | Ohio | Pennsylvania | Pipelines | Processing Plants | Statewide OH | Statewide PA | Statewide WV | West Virginia

MarkWest: 7 New NE Plants Online in Past 4 Mos, 17 More Coming!
January 31, 2014January 31, 2014

There are a number of midstream (pipeline and processing plants) companies operating in the Marcellus and Utica region. The country’s largest midstream company, Kinder Morgan, increasingly has a presence in the region. Joint ventures of various kinds, like Blue Racer Midstream (Dominion and Caiman Energy) are important new–and big–players. Williams Partners is one of the biggest. But if we had to identify which midstream company has the most assets, the most presence in the region, we’d have to say it’s MarkWest Energy. Yesterday MarkWest issued an operational update on their Marcellus and Utica projects–and frankly, it’s really impressive. This is a “time to crow about what we’ve done and will do” update. They’ve earned the right.

Over the past four months MarkWest has brought seven new, major projects online: 5 new cryogenic processing plants (separates wet gas into two streams, methane and NGLs), and 2 new fractionation plants (further separates the NGLs into their components, like ethane, butane and propane). Each one of these projects represents hundreds of millions of dollars of investment and hundreds of jobs. Here’s the kicker: MarkWest has another 17 major processing and fractionation projects under construction! Incredible. Below is the update issued yesterday by MarkWest which identifies many of projects and customers. It’s well worth your time to read:
Read More “MarkWest: 7 New NE Plants Online in Past 4 Mos, 17 More Coming!”
Blue Racer Midstream | Economic Impact | Energy Services | Industrywide Issues | MarkWest Energy | Pipelines | Processing Plants

Blue Racer Exec Says NE Midstream Needs Another $30B+ Investment
January 31, 2014January 31, 2014

Blue Racer Midstream CEO Jack Lafield spoke at the Hart Energy Marcellus-Utica Midstream Conference and Exhibition in Pittsburgh yesterday, and he had some interesting things to say. As for the $10 billion in infrastructure already invested in the Marcellus/Utica, Lafield says that’s “only a fraction” of what’s needed for investment in the coming years. Lafield says at least $30 billion more needs to be spent “just to keep up with the demand” for infrastructure. Yikes! He also said in his 42 years in the industry, “this is about as good as it gets.”

Also speaking yesterday was MarkWest Vice President of Corporate Development, Scott Garner, who said that MarkWest is spending $2 billion this year on the Marcellus/Utica. As MDN found with our list of 111 midstream/infrastructure projects published in our Marcellus and Utica Shale Databook Volume 2, we estimated there’s at least $40 billion in projects planned or already in process over the next five years or so. Here’s more pickings from yesterday’s conference:
Read More “Blue Racer Exec Says NE Midstream Needs Another $30B+ Investment”
Economic Impact | Energy Services | Industrywide Issues | Pipelines | Transco | Williams

Williams CEO: Transco Pipeline will Double Capacity by 2017
January 30, 2014January 30, 2014

Williams President & CEO, Alan Armstrong, addressed the Hart Energy’s annual Marcellus-Utica Midstream Conference & Exhibition at the David L. Lawrence Convention Center in downtown Pittsburgh yesterday. He said several interesting things, but the one that caught our attention was this: Williams is going to spend $5 billion expand their Transco methane pipeline. Transco runs from the Gulf Coast to New York. Armstrong said they will be adding more mainline to the Transco–making it longer, by about 9%. Which doesn’t seem like much, but it will nearly double the capacity of the entire pipeline. That’s a big hairy deal with lots of implications: More gas can get to market for consumers (bringing down prices for consumers), more gas can be shipped from drillers (more revenue for drillers), and more Marcellus gas will make it’s way into northeastern markets (great for drillers and landowners).

A summary of Armstrong’s speech:
Read More “Williams CEO: Transco Pipeline will Double Capacity by 2017”
Economic Impact | Electrical Generation | Industrywide Issues | Ohio | Statewide OH

New SW Ohio Electric Generating Plant to be Powered by Natgas
January 30, 2014January 30, 2014

Middletown, OH, located on the border of Butler and Warren counties in southwestern Ohio, is about to get a new $500 million natural gas-fired electric generating plant. That is, they will if NTE Energy’s plan is approved. The new plant will generate enough electricity to supply 400,000 homes. Although the story we found about the plant doesn’t say where the gas will come from, you can bet your bottom dollar it will be fueled by Utica and Marcellus Shale gas…
Read More “New SW Ohio Electric Generating Plant to be Powered by Natgas”
Economic Impact | Energy Services | Ethane | Industrywide Issues | Odebrecht | Processing Plants | West Virginia | Wood County

Houston Investment Firm a True Believer in WV Cracker Plant
January 28, 2014January 28, 2014

A huge vote of confidence by an investment firm that the ethane cracker plant recently announced by Gov. Earl Ray Tomblin and planned for Parkersburg, WV will actually be built (see WV Announces Brazilian Company to Build Ethane Cracker Complex). Siltstone Capital, an investment and advisory firm with corporate offices in New York and Houston, bought the old Blue Cross and Blue Shield building in downtown Parkersburg–vacant since 2009–to set up offices for the company and to lease out space they don’t use themselves.

Siltstone invests in companies in the energy sector: exploration and production, oil services, and midstream. If they weren’t totally convinced that the Odebrecht cracker plant would be built, you can be sure Siltstone would not have spent $475,000 on a vacant building in Parkersburg, WV (population 31,492)…
Read More “Houston Investment Firm a True Believer in WV Cracker Plant”
Economic Impact | Industrywide Issues | Jobs | Muskingum County | Ohio | Supply Chain | Utica Shale

OH Company Doubles Jobs/Revenue by Targeting Utica Shale Drillers
January 28, 2014January 28, 2014

Dan Pottmeyer, president of Producers Service Corp located in Zanesville, OH, says his company is the only fracking company that’s “home-grown in Ohio.” (That’ll be good news for OH Gov. John “foreigner hunter” Kasich. He likes ’em home-grown.) Pottmeyer’s company used to send oilfield services crews into Ohio’s conventional oil and gas fields for low-volume fracking work. However, after purchasing new equipment and more than doubling the work force, Pottmeyer now sends his crews into the field to work on Utica Shale wells–competing with the likes of oilfield services titans like Halliburton and Baker Hughes. Although he doesn’t disclose figures for the privately-held company, Pottmeyer says revenue has more than doubled in the past couple of years.

The Producers Service Corp story is a good story–an important story–of how local businesses can figure out how to plug in to the Marcellus and Utica Shale supply chain. Which is why we love to bring you stories like this one…
Read More “OH Company Doubles Jobs/Revenue by Targeting Utica Shale Drillers”
Economic Impact | Hydraulic Fracturing | Industrywide Issues | Jobs | Pennsylvania | Regulation | Statewide PA

PA Dem Consultant Lectures Party to Avoid Marcellus Moratorium
January 27, 2014January 27, 2014

Every now and again the truth pokes through–even in publications like the Philadelphia Inquirer. We read with interest an op-ed in today’s Philly Inquirer that tells the truth about how the Marcellus Shale is responsible for creating 290,000 jobs in Pennsylvania over the past few years–a state with an unemployment rate stuck above 7%. Some 28,000 of those jobs are “core” industry jobs that pay on average $83,000 per year or more. The op-ed says the Marcellus has given Pennsylvania families a reason to be optimistic about their financial future.

The fascinating thing to MDN is that the op-ed is written by Democrat consultant Mike Butler, current executive director of the Consumer Energy Alliance (Mid-Atlantic section). Mike is a former political consultant for Democrat Bob Casey for U.S. Senate (who sadly won), Dan Onorato for PA governor (who happily lost to Tom Corbett), and on the staff of former Democrat Congressman Jason Altmire. Huh. A Democrat singing the praises of the Marcellus shale, and at the close of his comments he warns the leaders of his party that the statewide moratorium they say they will enact if they regain political power in the state should be “avoided.” We’d use stronger words, but we’re happy to see at least one Democrat in the entire state hasn’t lost all of his marbles…
Read More “PA Dem Consultant Lectures Party to Avoid Marcellus Moratorium”