Make us your home page
Instagram

Natural gas drilling excites — and worries — Ohio

Thirty-four years after Black Monday, the day Youngstown Sheet & Tube announced shutdowns marking the end of the Ohio city's steel era, a $650 million mill is coming to life, thanks to the natural gas drilling boom.

Vallourec SA's V&M Star factory will have 350 workers and produce seamless pipes used in hydraulic fracturing, a process used to extract natural gas from shale formations in the ground. The process is commonly called fracking. It's part of a development that an oil and gas industry study calculates will mean more than 200,000 jobs and $22 billion in economic output in Ohio by 2015 — and which has neighboring states looking to get in on the action.

The new mill is rising about 2 miles from an injection well for disposing of wastewater from fracking that was closed after 11 earthquakes shook the Youngstown area last year. States that sit atop shale formations are cashing in on the drilling and the expanding businesses that support it, even as the Ohio Department of Natural Resources reviews the earthquake data and the U.S. Environmental Protection Agency studies the effects of fracking on drinking water with an eye on possible nationwide regulations.

"This will be the biggest thing to hit the state of Ohio economically since maybe the plow," Aubrey K. McClendon, chief executive officer of Chesapeake Energy Corp., the most active U.S. oil and natural gas driller, said during an energy summit that Gov. John Kasich convened in Columbus in September.

Drillers have turned fracking — a process that injects water, sand and chemicals into rock to free natural gas — into a production boom that helped cut prices 32 percent last year.

While some shale-gas development is anchored to the drilling sites, states are jockeying for spinoff investments, such as a "world-scale" natural gas processing plant that Royal Dutch Shell said it plans to build in Ohio, Pennsylvania or West Virginia.

All three states say they have offered incentives to Shell, and Kasich flew to Houston in November to hand-deliver letters of support for the project.

"States compete every day for every business they can find," Keith Burdette, West Virginia's secretary of commerce, said in a telephone interview from Charleston. "Suddenly, there's this vast new array of manufacturing opportunities that may be returning to this region of the country, and I think we'll all be aggressively looking for every opportunity."

Development of the shale-gas industry is one of Pennsylvania's top priorities, C. Alan Walker, secretary of community and economic development, said in a Jan. 4 interview in Harrisburg. Republican Gov. Tom Corbett has said he wants the state to be the "Texas of the natural gas boom."

Texas wants to be the Texas of the gas boom, too. Half of the eight most active U.S. oil- and gas-drilling regions are in the state, according to a December presentation by Pioneer Natural Resources Inc., a Dallas-based exploration and production company.

Oil and gas employment in the state increased by 18 percent to almost 238,000 during the year ended Oct. 31 and now exceeds the peak of the last energy boom in October 2008, according to the Texas Petro Index, a survey compiled by Amarillo economist Karr Ingham.

In Youngstown, which has lost more than half of the 168,330 residents it had in 1950, the V&M Star factory may help make the area the supply chain capital of the regional energy industry, said Eric Planey, a vice president at the Youngstown/Warren Regional Chamber.

"I look at it as being a bridge from our past to our future," Planey, whose father worked at Youngstown Sheet & Tube for 40 years, said in a Dec. 8 interview. "Our past was exclusively steel. It looks like our future is going to be significantly a part of the oil and gas and energy business."

Even so, an Ohio State University analysis concluded last month that the industry study, prepared for the Ohio Oil & Gas Energy Education Program, "greatly overestimates" the economic impact. Environmental groups, including the Natural Resources Defense Council, say that job-hungry states are moving too fast to capitalize before fracking's consequences are known.

Vanessa Pesec, president of the Network for Oil and Gas Accountability and Protection in Northeast Ohio, pointed to the earthquakes in the Youngstown area last year that she blames on the disposal well, including a 4.0-magnitude temblor on New Year's Eve.

"This is a short-term boom with long-term negative impacts," Pesec said in a telephone interview.

Recently, doctors at a conference on fracking in Arlington, Va., said the United States should declare a moratorium on the drilling process until the health effects are better understood.

David Mustine, general manager for energy of JobsOhio, the state's development arm, said Ohio has strong regulations and he doesn't think the complications from fracking will slow development.

Natural gas drilling excites — and worries — Ohio 01/14/12 [Last modified: Saturday, January 14, 2012 3:31am]
Photo reprints | Article reprints

© 2017 Tampa Bay Times

    

Join the discussion: Click to view comments, add yours

Loading...
  1. Toys 'R' Us files for bankruptcy but keeps stores open (w/video)

    Retail

    NEW YORK — Toys 'R' Us, the big box toy retailer struggling with $5 billion in debt and intense online competition, has filed for bankruptcy protection ahead of the key holiday shopping season — and says its stores will remain open for business as usual.

    Shoppers shop in a Toys R Us store on Black Friday in Miami in 2016. Toys R Us, the pioneering big box toy retailer, announced late Monday, Sept. 18, 2017 it has filed for Chapter 11 bankruptcy protection while continuing with normal business operations. [Associated Press]
  2. Trigaux: Waiting for your next pay raise? Keep dreaming, employers hint

    Working Life

    The economy's bouncing back. The stock market keeps hitting new records. And the jobless rate in Florida may soon drop below 4 percent. Surely, these are robust indicators — key signs that an annual raise is just around the corner. Right?

    Who doesn't want a pay raise? Demonstrators have rallied for years in a number of states for a $15 minimum wage. But many workers across a broad pay range are unlikely to see much if any raises this year, a new survey says. [AP Photo/Seth Wenig]
  3. Florida Guard scales down troop strength; Navy sails away from the Keys

    State Roundup

    The Florida National Guard on Monday drew down its activated statewide forces to about 1,200 on-duty troops, mostly in operations focused on relief distribution in the Florida Keys — and the last of a mini-armada of U.S. Navy ships off Key West set sail for home.

    Soldiers from the Florida National Guard's Delta Company, 1st Battallion, 124th Infantry, 53rd Infantry Brigade Combat Team on Sept. 14. The Federal Emergency Managment Agency has reported that 25-percent of all homes in the Florida Keys were destroyed and 65-percent sustained major damage when they took a direct hit from Hurricane Irma.  [Chip Somodevilla | Getty Images]
  4. LOCALE Market hosting St. Pete job fair for hospitality positions

    Business

    ST. PETERSBURG — Locale Market / FarmTable Kitchen is hosting a hospitality job fair Tuesday in St. Petersburg. The event will run from 10 a.m. to 2 p.m. at the LOCALE Market at 179 2nd Ave. North, St. Petersburg. Organizers said they hope to hire about 20 workers with a focus on displaced workers from Hurricane …

    Locale Market is hosting job fair on Tues., Feb. 19. [LARA CERRI | Times] 

  5. So far, 335,000 Irma claims totalling $1.95 billion filed in Florida

    Business

    Times Staff Writer

    As of Sunday afternoon, insurers had received a total of 335,347 claims statewide for insured damage totalling $1.95 billion caused by Hurricane Irma, the Florida Office of Insurance Regulation reported Monday based on preliminary figures.

    This shows a damaged mobile home inside Clover Leaf Farms RV Park in Brooksville. So far, insurers have received a total of 335,347 claims statewide for insured damage totalling $1.95 billion caused by Hurricane Irma.
[MEGAN REEVES   |   Times]