Economic Impact

Economic Impact | Hydraulic Fracturing | Industrywide Issues | Research

New EIA Drilling Productivity Report: Marcellus Passes 12 Bcf/d!
October 23, 2013October 23, 2013

Terry Engelder is a Penn State University geologist and professor. He was previously named to Foreign Policy magazine’s list of Top 100 Global Thinkers for his work with the Marcellus Shale. MDN calls him the “rock” star of the Marcellus, if you’ll pardon the pun (see Prof Terry Engelder: Marcellus Rock Star). In years gone by Dr. Engelder predicted that sometime in 2015 the Marcellus would be producing 12 billion cubic feet of natural gas per day. For his breathtaking, bold (and frankly wild) prediction he was praised by some, but scorned and ridiculed by many.

As MDN announced yesterday, the U.S. Energy Information Administration (EIA) is launching a new monthly Drilling Productivity Report (DRP). The very first report was issued yesterday (full copy embedded below). What does it show? It shows that Engelder was wrong. The Marcellus has just passed the 12 Bcf/d mark–now–this month. That is, the Marcellus is even more productive than Engelder’s so-called wild fantasy. According to an EIA spokesman, natural gas production from the Marcellus has surprised even the brainiacs at EIA who study this stuff for a living…
Read More “New EIA Drilling Productivity Report: Marcellus Passes 12 Bcf/d!”
Economic Impact | Ethane | Industrywide Issues | Processing Plants | Statewide WV | West Virginia

Did Gov Tomblin Find a European Investor for a WV Cracker Plant?
October 22, 2013October 22, 2013

At the beginning of October, MDN told you that West Virginia Gov. Earl Ray Tomblin was heading out on a 13-day whirlwind European ~~vacation~~ trade mission to five different countries. One of his aims was to find someone to invest in an ethane cracker plant in West Virginia (see WV Gov Going to Europe to Find Him a Cracker). Tomblin is almost done touring Europe and said by phone from Switzerland that “he expects to make announcements within the next few days concerning deals made” as a result of his trip.

Will one of those announced deals be an investment in a cracker plant?…
Read More “Did Gov Tomblin Find a European Investor for a WV Cracker Plant?”
Economic Impact | Electrical Generation | Exporting | Industrywide Issues | Research

GE Report: Natural Gas Taking the Limelight in World Energy
October 21, 2013October 21, 2013

Last week GE released a new report titled “The Age of Gas and the Power of Networks” (full copy embedded below). In the report, the brains at GE say that natural gas will soon rival coal use throughout the world, and is even starting to take some of oil’s market share away. By 2025 the report says 20% of the world’s natural gas supply will come from unconventional (i.e. shale) gas. Most that will come from the U.S. and Canada, and the majority of that will come from two shale plays: the Marcellus and the Eagle Ford. It shows the incredible importance of the Marcellus to the world’s energy supplies in the coming decades.

Other interesting factoids found in the report: 89% of natural gas is transported via pipelines, the rest by rail or truck or ship. LNG exports will play an increasingly important role as America continues to generate more natural gas that we can use here at home. And not surprisingly, the power sector (electric generation) will be the key future driver of demand for more natural gas, especially with tighter EPA regulations on coal generating plants…
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Economic Impact | Industrywide Issues | Jobs | Pennsylvania | Statewide PA

Marcellus Credited with 90% of New Jobs in PA 2005-2012
October 17, 2013October 17, 2013

Does Marcellus Shale drilling generate real jobs? You bet it does. Try this statistic on for size: Of all the new jobs created in Pennsylvania from 2005-2012, 90% of them were created by the drilling industry. No, that’s not a misprint. Those numbers come from analysts at Raymond James, a highly respected financial services firm. In addition, new hires in core Marcellus Shale industries were up 35% in the second quarter of 2013 compared to the second quarter of 2010. As one RJ analyst said, “unconventional oil and gas is not just a flash in the pan.” It will be a job-creating engine for decades to come.

When someone tells you drilling doesn’t create jobs, tell them to go fly a kite…
Read More “Marcellus Credited with 90% of New Jobs in PA 2005-2012”
Economic Impact | Ethane | Industrywide Issues | Processing Plants | Statewide WV | West Virginia

I’m Hooked on an (Ethane) Feeling, High on (Cracker) Believing
October 16, 2013October 16, 2013

Will the northeast ever get an ethane cracker plant to handle the massive amount of ethane being produced in wet gas areas of western PA, eastern OH and the panhandle of WV? Some people think so (MDN among them), although each year that goes by without a cracker it seems less likely because of new ethane and NGL pipelines being built to haul ethane out of the northeast. Still, people “in the know” say they have a feeling. Kind of reminds us of the old BJ Thomas song, “Hooked on a Feeling.”

Yesterday at the Wheeling (WV) Economic Outlook Conference, Don Rigby, executive director of the Wheeling-based Regional Economic Development Partnership, was the latest “in the know” person to say he’s hooked a cracker feeling…
Read More “I’m Hooked on an (Ethane) Feeling, High on (Cracker) Believing”
Economic Impact | Industrywide Issues | Processing Plants

Gas-to-Liquids Trend Picks Up Steam in Northeast
October 15, 2013October 15, 2013

An interesting trend to keep an eye on: gas-to-liquids (or GTL). Gas-to-liquids converts natural gas into other hydrocarbon compounds–like diesel fuel and chemicals used in manufacturing. If the economics are right, GTL may well become an important market for an abundance of very cheap natural gas in the Marcellus/Utica region. In fact, MDN has brought you stories about three such facilities that have been announced in the Marcellus/Utica region (see Chemical Manufacturer to Build Gas-to-Liquids Plant in PA; Altoona Area Getting $200M Marcellus Gas-to-Liquids Plant; and Utica Shale Gas-to-Liquids Plant Planned for Ashtabula, OH).

An article by SNL Financial highlights the fact that GTL is not just a northeastern U.S. trend and not just a national trend, but indeed it is an international trend…
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Economic Impact | Ethane | Hydraulic Fracturing | Industrywide Issues | Research

Tipping Point: More NatGas Now Produced by Shale than Conventional
October 14, 2013October 14, 2013

According to energy consulting firm PIRA Energy Group, the United States has reached a tipping point: We now produce more natural gas from shale deposits and “tight gas” formations (i.e. “unconventional sources”) than we do from traditional, conventional sources.

In a wide ranging article (below), PIRA and others quoted talk about the tremendous drop in prices for natural gas and gas liquids, the startling turnaround in chemical manufacturing in this country (because of the abundance of cheap natural gas and feedstocks like ethane), and the importance of the Marcellus/Utica in this whole equation. Hint: Nearly 1/3 of the natural gas being produced from shale comes from the Marcellus/Utica…
Read More “Tipping Point: More NatGas Now Produced by Shale than Conventional”
Economic Impact | Hydraulic Fracturing | Industrywide Issues | Research

Purdue Researchers: Shale Energy Adds $478B Per Year to US Economy
October 14, 2013October 14, 2013

Researchers at Purdue University recently presented the results from two studies analyzing the economics of shale energy and its impact on the U.S. economy (summary embedded below). They discussed their findings at the annual North American joint conference of the United States and International Associations for Energy Economics in Anchorage, Alaska (in July). What did the Purdue researchers find?

Purdue researchers found that shale oil and gas will increase the gross domestic product (GDP) of the United States by an average of 3.5% per year through 2035. In raw numbers, that means each and every year shale is adding $478 billion to our economy–a number so large it’s breathtaking. It seems to MDN that shale energy is single-handedly keeping our country out of yet another recession…
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Beaver County | Economic Impact | Energy Companies | Ethane | Industrywide Issues | Jobs | Pennsylvania | Processing Plants | Shell | Statewide PA

Dow Disingenously Tells Shell to Forget About a PA Cracker Plant
October 8, 2013October 8, 2013

Manufacturing and labor leaders held a confab yesterday in Pittsburgh to discuss jobs, the economy, and how the Marcellus is lifting both in southwestern Pennsylvania (see our companion story today). One of the speakers at yesterday’s meeting was Peter Molinaro, vice president and senior advisor on government affairs for The Dow Chemical Co. One of Dow Chemical’s chief rivals and competitors is Shell Chemical. Shell, as MDN readers are well aware, is currently conducting a multi-year evaluation of whether or not to build a regional ethane cracker plant in Beaver County, PA, outside Pittsburgh about 30 miles.

It probably won’t surprise you that Dow’s Molinaro said at yesterday’s meeting that PA probably doesn’t need a cracker plant after all. Are Molinaro’s comments about a PA cracker wise and measured counsel from an industry participant who has a feel for the economics of U.S. manufacturing and what it truly needs? Or are his comments trash-talking a competitor in hopes of scuttling a deal and eliminating competition so more ethane will be pipelined to the Gulf–where Dow’s cracker plants are located? You decide…
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Allegheny County | Economic Impact | Industrywide Issues | Jobs | Pennsylvania | Statewide PA | Washington County | Westmoreland County

Pittsburgh Summit: Marcellus the WD-40 of SW PA Rustbelt Economy
October 8, 2013October 8, 2013

Yesterday a group of manufacturing and labor leaders gathered at the International Brotherhood of Electrical Workers headquarters on Pittsburgh’s South Side to talk about the creation of more manufacturing jobs in the greater Pittsburgh area–specifically about how Marcellus Shale is changing the landscape and is a tremendous jobs creator in the region. Several publications attended and each put their own angle on what was said at the meeting.

MDN picks through the stories to bring you the bits and pieces we found interesting–news about how the Marcellus is changing the picture in southwest PA and beyond. One of those interesting tidbits: the chairman of the PA Public Utility Commission said Marcellus Shale gas has been responsible for power prices dropping an average 52% across the state–for everyone. Incredible! And a comparison between the Marcellus and WD-40…
Read More “Pittsburgh Summit: Marcellus the WD-40 of SW PA Rustbelt Economy”
Economic Impact | Hydraulic Fracturing | Industrywide Issues

U.S. Passes Saudis (Oil) & Russia (NatGas) to Become #1 Worldwide
October 7, 2013

None other than the U.S. Energy Information Administration (EIA) released a report on Friday that says the United States will pass Saudi Arabia to become the #1 oil producing country in the world, and will pass Russia to be the #1 natural gas producing country in the world–THIS YEAR. How? Why? Shale energy, of course. No wonder the Saudi’s are worried (see Top Saudi investor says US energy boom could doom kingdom’s economy) and even the braggadocio Vladimir Putin is showing signs of concern (see Worried by shale gas, Putin calls for new energy strategy).

This is really big news folks…
Read More “U.S. Passes Saudis (Oil) & Russia (NatGas) to Become #1 Worldwide”
Economic Impact | Ethane | Industrywide Issues | Processing Plants | Statewide WV | West Virginia

WV Gov Going to Europe to Find Him a Cracker
October 2, 2013October 2, 2013

West Virginia Gov. Earl Ray Tomblin is nothing if not persistent. For several years, the governor and his trusty Commerce Secretary Keith Burdette have been talking about landing an ethane cracker plant for WV (see WV Gov. Tomblin Beats the Ethane Cracker Drum Once Again). MDN is pulling for them! We have been for a long time. And it seems every few months we see a story along the lines of, “Just hold on, it’s a comin'”. But it never seems to.

So if a cracker investment is not coming to WV, Gov. Tomblin is going out to find it! He’s heading off to Spain, France, Germany, Switzerland and Italy on a European ~~vacation~~ trade mission in October to thank those countries for investing in WV, and to invite them to invest more. In particular, he’d like someone to invest in a cracker plant…
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Crude Oil | Economic Impact | Industrywide Issues | Jobs | NGLs | Ohio | Statewide OH | Utica Shale

U.S. Chamber’s Chris Guith Talks About Ohio Utica Shale
September 30, 2013September 30, 2013

Chris Guith is vice president for policy at the U.S. Chamber of Commerce’s Institute for 21st Century Energy. He’s also very familiar with the development of Ohio’s Utica Shale play. In a recent interview, Guith had some interesting comments on Ohio’s prospects for oil, NGL pipelines, industry jobs, regulations and more…
Read More “U.S. Chamber’s Chris Guith Talks About Ohio Utica Shale”
Allegheny County | Chevron | Economic Impact | Energy Companies | Industrywide Issues | Jobs | Pennsylvania

Chevron Wins 1st Approval for New Regional HQ Near Pittsburgh
September 20, 2013September 20, 2013

In May MDN told you about Chevron’s purchase of a 61-acre site in the suburbs of Pittsburgh where they plan to build a huge, 350,000 square foot office complex that will be home to 1,750 people when it’s done (see Chevron to Build New (Big) Regional HQ in Pittsburgh Suburb). It is an important sign that Chevron is committed–in a big way–to the Marcellus and Utica Shale.

On Wednesday the Chevron project moved one step closer to reality when Moon Township officials gave it their thumbs up…
Read More “Chevron Wins 1st Approval for New Regional HQ Near Pittsburgh”
Economic Impact | Energy Services | Industrywide Issues | Jobs | Pennsylvania | Pipelines | Statewide PA | UGI Energy Services

UGI to Invest $1.2B to Upgrade Pipelines in PA to Deliver NatGas
September 20, 2013September 20, 2013

UGI is Pennsylvania’s largest natural gas distributing utility serving more than 586,000 natural gas customers in 45 counties. Along with that many customers comes a lot of underground pipelines–some of which need to be replaced. So UGI is on a quest to hire at least 100 new full-time workers to help replace them. They plan to spend $1.2 billion on the project to upgrade their infrastructure in PA.

So what does UGI’s new pipeline replacement project have to do with the Marcellus Shale?…
Read More “UGI to Invest $1.2B to Upgrade Pipelines in PA to Deliver NatGas”
Commodity Price | Economic Impact | Industrywide Issues

Potential New Market for Marcellus/Utica Gas: LNG for Use in U.S.
September 19, 2013

Liquefied natural gas (LNG) isn’t just for exporting to other countries. LNG is increasingly used right here at home, in the U.S. GDF SUEZ Gas has provided LNG to the northeastern U.S. for the past 40 years for use in ships, railroad locomotives, long-haul trucks, and heating/power generation. Earlier this week GDF SUEZ announced a sort of “open season” for bids on a massive increase in their capacity to provide more LNG in the northeast. They call it the advanceLNG Project.

The potential good news for producers of Marcellus and Utica Shale gas is that if the advanceLNG Project moves forward, it will need lots of natural gas from the region to feed it. advanceLNG is a potentially lucrative new market for the northeast’s abundant supplies of natgas…
Read More “Potential New Market for Marcellus/Utica Gas: LNG for Use in U.S.”