Posts Tagged ‘U.S. Steel’

Orginally published on May 21, 2010

By:  STEVE MOCARSKY

SCRANTON – The president of the Marcellus Shale Coalition on Monday told regional community leaders that development of the Marcellus Shale not only will help the economy on a large scale, but it’s just as important to recognize the effects on the area business owners and the area job market.

Kathryn Klaber, who was hired four months ago as the first president of the fledgling coalition, said it was formed in 2008 to advance responsible development of natural gas from the geological formation that lies more than a mile below a good portion of the state.

She was a guest speaker at the annual Lackawanna-Luzerne County Indicators Report presented by the Institute for Public Policy & Economic Development at the Radisson Lackawanna Station hotel.

The report looks at many factors in the area, including jobs, economics, housing and education. All of those are being influenced by development of the Marcellus Shale, Klaber said.

Klaber said macroeconomics are important, “and every shale play has them. But we also realize we have to make this more understandable, that these are real jobs with real companies in Pennsylvania,” she said.

“Around a well site, you’ve got basically a $4 million construction project for each well. And with that comes all sorts of stuff that we make here in Pennsylvania. This is a chance to kind of rebuild that making-and-doing economy,” Klaber said.

Klaber went through each step of well development and explained the types of companies are involved, the kinds and quantities of materials used, and the opportunities that already are being realized by local and Pennsylvania companies.

With new well cementing regulations being proposed by the state Department of Environmental protection, “there is more cement manufacturing that we could be doing here. Rail has been seeing record months of cargo with their hauling related to the Marcellus, she said.

“When we think of it, we just think, oh, the handful of people running that one piece of equipment to drill the well,” Klaber said.

“Oh my gosh, no. In site operation, who’s going to bring backhoes and graders from out-of-state? No, it’s the companies that own the backhoes and graders that is going to be hired to do the site preparation work. Compressors, we’ve got a lot of companies that build components for compressor stations here,” she said.

“Chief Oil & Gas had a 4,000-ton order they just placed with U.S. Steel in the Mon Valley (near Pittsburgh). It’s 50 miles of pipe and that’s only a fraction of what you need in the course of a year,” Klaber said.

Klaber said the coalition is 92 members strong and “growing by the dozens every month.”

Contact the author:  smocarsky@timesleader.com

Copyright:  The Times Leader

Potential for economic plus to area. Williamsport benefits despite no well within 12 miles.

By Steve Mocarskysmocarsky@timesleader.com
Staff Writer

With most of the nearby Marcellus Shale natural gas production occurring north and west of Luzerne County, the question of whether Greater Wilkes-Barre will benefit with an economic boom or be bypassed remains unanswered.

It depends on a number of factors, including the volume and quality of natural gas that can be harvested in the county.

If prospects are not good here, the proximity of natural gas development in nearby counties could have some impact locally if the infrastructure close to Wilkes-Barre has the most to offer nearby energy companies, drillers and their employees, according to an economic development official in a county that has been reaping the benefits of Marcellus Shale production.

Jason Fink, executive vice president of the Williamsport/Lycoming Chamber of Commerce, said chamber officials began seeing signs of interest in gas production in Lycoming County about two years ago when the appearance of landmen first became noticeable.

Work had begun on five to seven natural gas wells in northern Lycoming County by the end of 2007, according to records from the state Department of Environmental Protection.

By the end of 2008, 13 more wells had been drilled; another 24 followed last year, and four more have been drilled this year.

And although the closest well is about 12 to 15 miles from Williamsport, the city of about 30,000 is seeing “a number of significant areas of development,” Fink said.

A boom hits Williamsport

The first evidence of business development related to the shale came about a year and a half ago with growth in oil field services. Chief Oil & Gas has been operating for well over a year in the county and Anadarko Petroleum Corp. also has had a presence, Fink said.

Precision Drilling set up shop and Weatherford – a mechanical/technological support company for the oil and gas industry – is in the process of developing a 20-acre site in the county, he said.

Industrial Properties Corp., which is operated by the chamber, sold a 24-acre parcel to Halliburton, which is in the process of developing the property and projects the hiring of 250 employees at the site.

Sooner Pipe, which provides casing pipe for Chesapeake Energy and is one of the largest customers of U.S. Steel, just signed a 10-year lease with the Williamsport Regional Airport for a pipe lay-down yard. That project is expected to employ 50 people when operational, Fink said.

The work force at Allison Crane & Rigging – a third-generation family-owned company in Williamsport – grew by more than 50 employees early on in the well construction phase. And Sooner Pipe intends to use local trucking company Woolever Brothers Transportation to haul all of its pipe when the facility is operational, Fink said.

It’s all about infrastructure

Fink said that Williamsport is benefiting from the gas extraction activity, the heart of which is at least 15 to 20 miles northwest and northeast of the city, because it has more to offer than more rural counties to the north.

“They need to have access to certain infrastructure to conduct their business. We have a highway system, housing, hotels, restaurants – everything they need for their employees. Bradford and Tioga are more rural and have very limited hotel space,” Fink said, adding that rail service through Norfolk Southern and a short line and a nearby interstate highway also helps matters.

Bradford County saw 113 wells drilled last year, while Tioga County had 114.

Because of the influx of workers, the city saw demands for home and apartment rentals grow. Developers responded by renovating space above downtown businesses, creating new rental units.

Fink said local unemployment had been hovering around 10 percent, but he’s seen it drop to 9.1 percent lately.

“We’ve been working with the Pennsylvania College of Technology and the local CareerLink office. Really, once more local people are able to gain the skills this industry requires, I think you’ll be able to see a greater economic impact,” he said.

Would it work in Wilkes-Barre area?

“I would think Wilkes-Barre would have the same opportunities if they find gas in volumes in areas proximate to Wilkes-Barre. And the Wilkes-Barre area understands the positive side as well as the pitfalls of the acquisition of natural resources for energy purposes,” Fink said.

Todd Vonderheid, president of the Greater Wilkes-Barre Chamber of Business and Industry, agrees.

“There’s certainly an opportunity to be captured for the region. Several things have already happened,” Vonderheid said.

Vonderheid noted that several suppliers and vendors to the gas-and-oil industry already are locating in the region and hiring locally.

“We’re trying to facilitate that and make the process as easy as possible. We’re working with energy company officials to better learn what those supply opportunities might be,” Vonderheid said, adding that representatives of Chesapeake and EnCana energy companies sit on the chamber board of directors.

Vonderheid said a presentation for chamber members on Marcellus Shale opportunities, the gas extraction process, environmental issues and the possible economic impact is in the works.

Copyright: Times Leader