Economic Impact

Economic Impact | Industrywide Issues

Who Owns U.S. Oil & Natural Gas Companies? You
October 28, 2011October 28, 2011

Who actually owns U.S. oil and natural gas companies? If you’re one of the economic illiterates in the “Occupy” movement, you no doubt believe the oil and gas industry is owned by “the 1 percent”. But you would be wrong. A new study just released proves the middle class (ie you) owns the vast majority of America’s energy companies via pension plans like 401(k)s and IRAs, as well as by individual stock investments. The numbers break down as follows: 50 percent of shares in energy companies are held by public and private pension plans, 20 percent by individual investors who own stock, 27 percent of shares belong to financial institutions and asset management companies, and 3 percent of outstanding shares are held by the officers and board members of the energy companies themselves.

The study, "Who Owns America’s Oil and Natural Gas Companies," was commissioned by the American Petroleum Institute and conducted by Sonecon. The full 22-page study is embedded below.

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Economic Impact | Hydraulic Fracturing | Industrywide Issues

Huge Shale Find in UK, Marcellus x 10?
October 26, 2011October 26, 2011

An interesting tidbit those of us in the U.S. can only salivate over… There is a shale formation in the U.K. that spreads all the way from North Wales (in the south of England) to near the Scottish border in Cumbria (in the north) and well over into Yorkshire as well. That is, it sits under most of the country. But here’s the unique thing about that shale deposit: A couple of exploratory wells drilled by British Gas found the thickness of the shale layer to be 3,000 feet! That is ginormous. By comparison, the Marcellus Shale layer is an average 300 feet thick. The UK shale layer is 10 times that amount. Meaning it holds perhaps 10 times the amount of shale gas as an equivalent section of the Marcellus.

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Economic Impact | Industrywide Issues | Public Opinion

Prize-Winning Author Says Fossil Fuels Not Going Away Soon
October 4, 2011October 4, 2011

Comments from a recent interview with Daniel Yergin, a Pulitzer Prize-winning author and member of President Obama’s energy subcommittee examining shale gas (see MDN’s previous article about Yergin).

Mr. Yergin was interviewed by the Philadelphia Inquirer and had these observations:

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Economic Impact | Industrywide Issues | Ohio | Statewide OH

Ohio Now in the Hunt for an Ethane Cracker
October 3, 2011October 3, 2011

You can add Ohio to both Pennsylvania and West Virginia on the official list of eastern states actively courting the investment of Shell and others who seek to build an multi-billion dollar ethane cracker plant.

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Economic Impact | Industrywide Issues | Public Opinion

Obama Advisor Says Shale Gas Drilling is Here to Stay
September 28, 2011September 27, 2011

Daniel Yergin, a Pulitzer Prize-winning author and member of President Obama’s energy subcommittee examining shale gas, says the debate about whether or not to drill for shale gas is already over and decided—shall gas drilling is here to stay.

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Economic Impact | Industrywide Issues

Shale Gas and Chemical Industry Interconnected
September 21, 2011September 21, 2011

Yet more evidence of the importance, and the interconnectedness, of the shale gas industry and the plastics industry in the U.S. comes from none other than the American Chemistry Council. The ACC says that shale gas,

…will yield so much ethylene — the basic building block of plastics — that the United States will become the world’s lowest-cost source of feedstock in the world outside of the Persian Gulf.(1)

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Economic Impact | Industrywide Issues | Virginia | Warren County

Marcellus is “Game Changer” for New Electric Power Plants
September 20, 2011September 20, 2011

Dominion will build a huge, new 1,300-megawatt power plant in Virginia—and it will be powered by Marcellus Shale gas. Final regulatory approval for the plant will come sometime in 2012, and the construction will be completed by 2014. The fact that power generating companies are constructing new power plants that use natural gas as the sole fuel source signals an important shift in the energy picture for the U.S.

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Commodity Price | Economic Impact | Industrywide Issues | New York | Statewide NY

Wind Farm Project Canceled Due to Cheap Marcellus Gas
September 19, 2011September 19, 2011

Those who oppose natural gas drilling do so because it threatens their ideology that renewable energy should be the only available option. Renewable energy supporters don’t seem to care that it costs 3-5 times more (that’s 300-500 percent more) for electricity from renewable sources than from fossil fuel sources. Rather than celebrate our good fortune in finding a cheap, abundant source of something that pollutes far less than other sources—shale gas—they attack it and claim it’s just as bad as the dirtiest coal. It’s sad, really.

Here’s yet another example of so-called renewables failing the economic test, an example sure to push some of the antis over the edge. It looks like the $1 billion Great Lakes offshore wind farm is yes, out of wind (bad pun intended). And the reason why it’s being canceled? Marcellus Shale gas—abundant, and cheap.

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Economic Impact | Industrialization | Industrywide Issues | Jobs | New York | Statewide NY

New Study Says Gas Drilling in NY Will Create 54K Jobs
September 8, 2011September 8, 2011

A private study on the socio-economic impacts shale gas drilling is projected to have in New York State shows hydraulic fracturing will create some 54,000 jobs and result in $2.5 billion in economic activity. The report, titled “Economic Assessment Report for the Supplemental Generic Environmental Impact Statement on New York State’s Oil, Gas, and Solution Mining Regulatory Program,” was commissioned by the New York Department of Environmental Conservation (DEC) and researched and written by Ecology and Environment Engineering, P.C. A full copy is embedded below.

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Economic Impact | Energy Companies | Industrywide Issues | Jobs | Shell

Shell Nears Decision on Where to Build $2B Cracker Plant
September 7, 2011September 7, 2011

Shell Oil is “nearing a decision” on where to build a multi-billion dollar ethylene cracker plant in the Marcellus region, and states in that region—specifically Pennsylvania, West Virginia and Ohio—are aggressively competing to have the plant built in their state. (See MDN’s petrochemical primer for details on how shale gas drilling relates to the chemical industry).

The stakes are high indeed. The cost to build the plant will exceed $2 billion, and it’s estimated the plant will attract some $16 billion in associated industry expenditures and provide more than 17,000 jobs in those associated industries.

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Economic Impact | Energy Companies | EQT Corp | Industrywide Issues | Pennsylvania | Statewide PA | Washington County

How Much Does it Cost to Drill a Single Marcellus Well? $7.6M
September 7, 2011September 7, 2011

A new 92-page study just released by the University of Pittsburgh (copy embedded below) takes a realistic look at the direct costs, and economic impacts, of drilling a single Marcellus Shale gas well. The study, called the “Economic Impact of the Value Chain of a Marcellus Shale Well,” looked in depth at an EQT-drilled well in Washington County, PA. Undergraduate and graduate students from Pitt found that a single well had direct costs of more than $7.6 million. Or think of it this way: More than $7.6 million is invested in a local community, on average, for each and every well drilled.

The costs to drill a well break down this way:

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Economic Impact | Industrywide Issues | Jobs | Pennsylvania | Statewide PA

New Penn State Study on Economic Impacts of Marcellus Drilling
September 7, 2011September 7, 2011

A new 62-page study (embedded below) conducted by Penn State and the Pennsylvania College of Technology looks at the economic impact of natural gas drilling in PA. The study, titled “Economic Impacts of Marcellus Shale in Pennsylvania: Employment and Income in 2009,” uses a new (and according to the authors more accurate) methodology to calculate gas drilling’s economic impacts on local communities. The authors suggest the economic impacts of Marcellus drilling for local communities are not as big as previously reported.

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Economic Impact | Industrywide Issues | Pennsylvania | Statewide PA

The Mighty Marcellus Roars in PA – Production Up 55% in 6 Months
August 17, 2011August 17, 2011

Now we know why it’s called “The Mighty Marcellus.” New production figures for the first six months of 2011 show that on all counts—natural gas, gas liquids, and even oil—the Marcellus Shale in Pennsylvania is producing a tremendous amount of new energy. Figures for the southwestern part of PA show a 55 percent increase in production over the previous six month period.

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Economic Impact | Industrywide Issues | Pipelines

New Marcellus Pipeline Construction Pumping $2B into Economy
August 17, 2011August 17, 2011

New pipeline construction for Marcellus Shale gas is set to have a major economic impact on the Marcellus region—to the tune of $2 billion. The new capacity in Marcellus pipelines will more than double the existing capacity in place now:

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Chesapeake Energy | Economic Impact | Energy Companies | Industrywide Issues | Lease & Royalty Payments | Ohio County | West Virginia

Ohio County Receives $8M (So Far) from Marcellus Gas Leases
August 16, 2011August 16, 2011

Ohio County, WV is reaping the rewards of leasing county-owned land for Marcellus gas drilling. The county’s land leases with Chesapeake Energy have already resulted in nearly $8 million in one-time lease payments for the county coffers, and soon will mean royalty payments too. Chesapeake has already completed a well on private land adjacent to (and drilling under) county land in The Highlands area. But gas from that well has not yet started to flow due to a delay in getting a pipeline built to the well. Once the pipeline is in place, the county will start receiving royalty checks from that well.

And within the next 12 months, Chesapeake will drill a new well, this time directly on county-owned land at the airport:

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Economic Impact | Industrywide Issues | Jobs | Statewide WV | West Virginia

WV Invests $250K in Marcellus Ethane Processing Plant
August 12, 2011August 12, 2011

The state of West Virginia is investing $250K in a company that turns ethane from Marcellus gas wells into ethylene. Think of it as a “mini-cracker plant”. Shell and other large energy companies are looking to establish large cracker plants in the Marcellus region—a chemical plant that will take over $1 billion to build (see this MDN story). In the meantime, smaller and leaner companies are providing some of the same kinds of service a cracker plant provides—at much less of an investment. Aither Chemicals is one of those companies.

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