That wide picture of Timken Company by Sherman Cahal is ruining this page by forcing text to scroll of the right edge.  Can you take it down or resize it?  thanks

Cross-posted from the Youngstown Biz thread....

 

Weatherford Eyes Fall Start, 150 Jobs in Youngstown

Tuesday, May 08, 2012

By George Nelson

 

YOUNGSTOWN, Ohio – Weatherford International Ltd. tentatively plans to begin operations at its new Youngstown site in late September and hire about 150 employees, the company said Monday.

 

The Swiss-based multinational oilfield services and technology company, plans to locate a “multiphase operations facility offering a wide variety of products and services that span the lifecycle of a well – drilling, evaluation, completion, production and intervention,” according to a fact sheet issued by the company.

 

Weatherford is in the process of finalizing specifically what activities will take place at the site and what skills will be required, said Melanie Kania, communications specialist. “What we need to do is finalize what product lines we are going to have at that facility,” and once that is determined, the company will have a better idea of what positions will need to be filled and what skills they will be looking for in applicants, she explained.

 

READ MORE AT:

http://businessjournaldaily.com/drilling-down/weatherford-eyes-fall-start-150-jobs-youngstown-2012-5-8

Cross-posted from the rail freight growth thread. This is at SR11's interchange with SR344, and served by NS's busy east-west Fort Wayne Line. It could also be served by Y&SE/Tervita by reactivating a spur that came off their north-south line and headed west to Leetonia....

 

Former NRM Complex in Line for Shale Industry Makeover

Wednesday, May 09, 2012

By Dan O'Brien

 

EAST LIVERPOOL, Ohio – When Jerry Stoneburner purchased the former National Refractories complex just outside Columbiana nine years ago, he had no idea how he was going to fill the 300,000-square-feet of space and the nearly 100 acres it sits on.

 

The purchase, Stoneburner now says, was a simple case of buying the right place at the right time.

 

..."The reason we bought the plant was because of the rail access," he said. Once these two companies are up and running, he estimates there could be more than 200 working at the site.

 

It could become a vibrant hub for distribution and storage for sand, water and pipe used in the oil and gas industry, he said.

 

READ MORE AT:

http://businessjournaldaily.com/drilling-down/former-nrm-complex-line-shale-industry-makeover-2012-5-9

Consol Begins Building its Shale Well in Ellsworth

Monday, May 14, 2012

By Andrea Wood

 

ELLSWORTH Township, Ohio – Heavy dump trucks arrive every five minutes or so; about lunchtime, they’re lined up five-deep, waiting to deposit their limestone loads where Consol Energy is building its first shale well pad in Mahoning County.

 

It’s the first day of the trucks traveling back and forth from the limestone quarries in Petersburg to the Hendricks farm off Western Reserve Road here. A guard at the gate checks each truck in and out as men from a sign-making company work off to one side of the gravel-road entrance, posting identifying signs and preparing safety warnings they’ll hang 2,000 feet from the entrance, where the well pad is being built.

 

“This stone is coming right here from the good old USA,” says one of the truck drivers with a wide, satisfied grin.

 

READ MORE AT:

http://businessjournaldaily.com/drilling-down/consol-begins-building-its-shale-well-ellsworth-2012-5-14

Ohio Senate wants fracking chemicals identified but neglects wind farms

by John Funk

 

http://www.cleveland.com/business/index.ssf/2012/05/ohio_senate_would_have_frackin.html

 

The public would have a better idea of what chemicals shale gas well developers are using,

under legislation approved by the Ohio Senate on Tuesday and now headed to the Ohio House.

 

But the state stands to lose $2 billion in new wind farm development because of that same bill.

 

If approved by the House of Representatives next week as expected, the legislation would encourage

public colleges and other institutions to build heating and power plants fired by natural gas and get

credit for them as renewable energy, as proposed by Gov. John Kasich.

 

Those credits now go to help finance wind farms, and developers will probably not be able to build five

farms already permitted because the new system would squeeze them out.

 

"We are looking at a serious setback," said Dayna Baird, a lobbyist retained by the American Wind Energy Association.

...

Cogeneration is a great idea, as I mentioned in a previous posting.  However, the oil and gas business is a mature

industry and it does not need public subsidies to operate.  Cogeneration should be enabled by other policies.

Our country needs renewable generation because eventually we are going to run out of fossil fuels.

 

 

A good article quoting a couple of real estate guys who know what's going on in the downstream gas biz. There's also an editorial likely to follow on this subject....

 

Port Authority may play role in shale gas industry

May 22, 2012

By LARRY RINGLER - Business Editor , Tribune Chronicle | TribToday.com

 

VIENNA - The Western Reserve Port Authority, along with officials throughout the Mahoning Valley, must be ready to attract employers tied to the area's budding natural gas industry, two real estate experts said Monday.

 

"It's the holy grail - spinoff jobs if we can get a processing or a cracker plant," Dan Crouse of commercial real estate firm Routh-Hurlbert, told Port Authority members at their monthly meeting at the Youngstown-Warren Regional Airport.

 

Crouse and Chuck Joseph, who said they've been meeting with other area leaders, told board members the opportunity is similar to the steel industry more than 100 years ago, when steel slitting and other service plants located in the area to be close to giant steel mills.

 

READ MORE AT:

http://www.tribtoday.com/page/content.detail/id/572031/Port-Authority-may-play-role-in-shale-gas-industry.html?nav=5358

...

As trustee of the New York State Common Retirement Fund, which owned about 3.5 million shares of

Chesapeake as of May 18, New York State Comptroller Thomas P. DiNapoli called on investors to

withhold their votes for (board members) V. Burns Hargis and Richard K. Davidson at an upcoming annual shareholders meeting.

 

"A fundamental restructuring of the company's board of directors is essential if the board is to regain the

trust of stakeholders and regulators," DiNapoli wrote in a letter to shareholders. The board should

"protect the long-term interests of the company instead of promoting parochial interests of maintaining

incumbent control," he said.

 

A series of revelations detailing possible conflicts-of-interest issues involving Chesapeake Chief Executive

Aubrey McClendon has a brought fresh wave of criticism against the company and its board. Activist investor

Carl Icahn recently reported a 7.6% stake in the company, and called for the replacement of at least four

of the company's board members. The company has said it would "carefully review" his request.

 

California Public Employees' Retirement System has also pushed for governance changes at the company,

focusing on plurality voting requirements.

 

Chesapeake faces a cash crunch, which along with corporate-governance controversies have pushed its

stock to the lowest level since 2009. Pressure is mounting on Chesapeake, the nation's second-largest

natural-gas producer after Exxon Mobil Corp. (XOM), to raise billions of dollars by selling some of its prized

assets to fund its operations and repay loans.

...

http://online.wsj.com/article/BT-CO-20120529-709074.html

At first, I was going to say that some of these "activist investors" are so impatient. But these aren't stupid people. They may well have long positions in the company which is well-positioned throughout the liquids-rich Utica play. It's probably a good a time to buy stock in Chesapeake with all of these short-term distractions artificially depressing its per-share value. I would not be surprised if some of these recent disclosures were the result of information leaked by Icahn and other activist investors. Furthermore, nat gas prices appear to have bottomed out as well. Structurally, this is a fundamentally sound market to be in over the next 5-10 years.

At first, I was going to say that some of these "activist investors" are so impatient. But these aren't stupid people. They may well have long positions in the company which is well-positioned throughout the liquids-rich Utica play. It's probably a good a time to buy stock in Chesapeake with all of these short-term distractions artificially depressing its per-share value. I would not be surprised if some of these recent disclosures were the result of information leaked by Icahn and other activist investors. Furthermore, nat gas prices appear to have bottomed out as well. Structurally, this is a fundamentally sound market to be in over the next 5-10 years.

 

There may be some truth to this, but be careful about confusing a judgment about the market with a judgment about a particular company.  Chesapeake does have a lot going for it if it can get its act together, I agree.  However, I do worry about the impact of activist shareholders like Icahn.  While perhaps not all activist shareholders are created equal, I was less than enthralled with Nelson Peltz' activist maneuverings with Wendy's.  I haven't followed Icahn closely because I've never owned anything that he's had a significant interest in.

Part of what I like about Chesapeake is that they've acquired potentially valuable assets throughout the Utica play. But for those who want quick returns, they are probably frustrated with Chesapeake buying so much at a time of a falling natgas prices. But like I said, I think natgas prices have bottomed out and the long-term wet natgas market is so good, and no one else is as well-positioned to capitalize on this over the next 5-10 years as is Chesapeake. So I think I'm balancing my views between market and company pretty well. But I'm probably thinking too long-term for some investors. I don't know if Icahn is a patient investor or not.

Cross-posted from the Booming Growth on Freight Railroads thread......

 

This could result in carload traffic growth on this line. And the rail ROW lease in Mahoning County is interesting!

 

Port authority provides more land to Chesapeake

May 26, 2012

By TOM GIAMBRONI - Staff Writer ([email protected]) , Morning Journal News

 

EAST LIVERPOOL - The Columbiana County Port Authority plans to lease some more of its property for shale gas development.

 

The port authority board agreed at this week's meeting to lease an additional 44 acres to Chesapeake Exploration, a subsidiary of natural gas giant Chesapeake Energy, for $1,800 an acre and 15 percent royalties. This will generate a signing bonus of $79,200.

 

...The 44 acres represents the portion of the 36-mile railroad owned by the port authority that lies in neighboring Beaver County, Pa. The former Youngstown & Southern Railroad, which the port authority is in the process of selling, connects Boardman in Mahoning County and Darlington, Pa., with the majority running through this county.

 

...Drake said they are also working to lease the Mahoning County portion of its railroad right-of-way to Chesapeake.

 

READ MORE AT:

http://www.morningjournalnews.com/page/content.detail/id/540318.html

Shale gas boom could bring manufacturing jobs back to U.S., economists say

Published: Thursday, May 31, 2012, 6:00 PM    Updated: Friday, June 01, 2012, 10:18 AM

By Robert Schoenberger, The Plain Dealer

 

CLEVELAND, Ohio -- The shale gas boom hitting Ohio, Pennsylvania and several other states could provide a major advantage to manufacturers in the United States -- cheap energy that could significantly cut the costs to produce goods here, a group of economists said Thursday.

 

"By 2025, the manufacturing sector alone could save $11.5 billion in energy costs," Robert McCutcheon, an economist with consulting group PwC, said at a manufacturing summit hosted by the Federal Reserve Bank of Cleveland. McCutcheon's company, formerly called PriceWaterhouseCoopers, released a study late last year predicting that as many as 1 million new U.S. manufacturing jobs could come from lower-cost energy.

 

"If we save $11.5 billion, that's investment capital that could be redirected elsewhere," McCutcheon added.

 

READ MORE AT:

http://www.cleveland.com/shalegas/index.ssf/2012/05/shale_gas_boom_could_bring_man.html

Fracking great: The promised gas revolution can do the environment more good than harm

The Economist, Jun 2nd 2012

 

The revolution should continue, according to a report published this week by the International Energy Agency (IEA). At current production rates, America has over a century’s supply of gas, half of it stored in shale and other “unconventional” formations. It should also spread, to China, Australia, Argentina and Europe. Global gas production could increase by 50% between 2010 and 2035, with unconventional sources supplying two-thirds of the growth ...

 

For as well as posing environmental risks, a gas boom would bring an important environmental benefit. Burning gas emits half as much carbon dioxide as coal; so where gas substitutes for coal, emissions will fall. America’s emissions have fallen by 450m tonnes in the past five years, more than any other country’s. Ironically, given its far greater effort to tackle climate change, the European Union has seen its emissions rise, partly because of an increase in coal-fired power generation in response to Europe’s high gas price.

 

READ MORE AT:

The Economist

There are folks trying to get a processing plant or two, as well as an ethane cracker to locate in Youngstown, Warren, Canton or possibly other cities too. It all depends on where the gathering and transmission pipelines are located -- or could be located.....

 

Dominion Scouting Ohio Sites for Processing Plants

Tuesday, June 05, 2012

By Dan O'Brien

 

YOUNGSTOWN, Ohio – Dominion, one of the largest energy suppliers in the country, is scouting sites in Ohio for future plants that would process natural gas drilled from the Utica shale, a company executive said Monday.

 

"The shale industry is driving our business right now," said David Mordan, director of natural gas operations for Dominion Transmission. "We've looked at other sites in Ohio. We've been here for a long time and we want to continue that."

 

Dominion Resources is constructing a $500 million processing plant in Natrium, W. Va., just south of Wheeling in Marshall County. The plant is scheduled to come online by the end of this year, and would be capable of processing natural gas liquids extracted from the Marcellus shale in western Pennsylvania and the Utica, a tight rock formation buried thousands of feet below eastern Ohio.

 

READ MORE AT:

 

Fracking great: The promised gas revolution can do the environment more good than harm

The Economist, Jun 2nd 2012

Cleaner, but not clean enough

 

By itself, switching to gas will not reduce emissions to anything like the levels required to avoid a high risk of serious climate change. This will take much crunchier policies to boost renewable-energy sources and other clean technologies—starting with a strong price on carbon emissions, through a market-based mechanism or, preferably, a carbon tax. Governments are understandably unwilling to take these steps in straitened times. Yet they should plan to do so; and in the coming years cheap gas could help free cash for more investment in low-carbon technologies. Otherwise the bonanza would be squandered.

...

No fracking kidding!

If this takes off, it will boost natgas prices, drilling activities and the economies of Ohio and Pennsylvania....

 

TravelCenters of America, Shell Oil to create natural gas fueling stations along highways

By DAN SHINGLER

9:52 am, June 7, 2012

 

The natural gas car business stands to get some fuel, literally, from a deal struck between Shell Oil Products U.S. and Westlake-based TravelCenters of America to install compressed natural gas filling stations at a minimum of 100 locations.

 

TravelCenters announced that it had entered into an agreement with Shell to build and operate a network of at least 200 compressed natural gas (CNG) fueling stations at 100 or more TravelCenters locations on U.S. interstate highways. Thereafter, expansion will be based upon customer demand for the fuel, TravelCenters said.

 

TravelCenters said it also will train “a significant number” of its approximately 3,000 repair technicians to work on CNG vehicles.

 

READ MORE AT:

http://www.crainscleveland.com/article/20120607/FREE/120609868#

I recall that the gangsters who drilled Ohio in the 1980s routinely dumped brine into roadside ditches at night when there was scant traffic and the neighbors were asleep.

...excerpt:...

Truckers often dump their wastewater rather than wait in line at injection wells. The Department of Mineral Resources asks companies how much brine their wells produce and how much they dispose of as waste, but its inspectors don't audit those numbers. Short of catching someone in the act, there's no way to stop illegal dumping.

 

The state also has no real estimate for how much fluid spills out accidentally from tanks, pipes, trucks and other equipment. Companies are supposed to report spill volumes, but officials acknowledge the numbers are often inexact or flat-out wrong. In 40 cases last year, the company responsible didn't know how much had spilled so it simply listed the volume of fluid as zero.

...snip...

Six years ago, a four-inch saltwater pipeline ruptured just outside Linda Monson's property line [11], leaking about a million gallons of salty wastewater.

 

As it cascaded down a hill and into Charbonneau Creek, which cuts through Monson's pasture, the spill deposited metals and carcinogenic hydrocarbons in the soil. The toxic brew wiped out the creek's fish, turtles and other life, reaching 15 miles downstream.

...snip...

Read on about farms destroyed by saline dumping.  Whether it was against "regulations" or not, it is still a horror. 

 

http://www.propublica.org/article/the-other-fracking-north-dakotas-oil-boom-brings-damage-along-with-prosperi

 

[11] http://www.propublica.org/documents/item/329926-zenergy-inc-spill-site-investigation-2006.html#document/p2/a50761

Utica Processing Plants on Track for August Start

Thursday, June 14, 2012

By Dan O'Brien

 

YOUNGSTOWN, Ohio -- Chesapeake Energy Corp.’s $4 billion deal to sell its pipeline interests isn’t likely to derail plans to build a natural gas processing network in the Utica shale of eastern Ohio, executives say.

 

“There doesn’t appear to be any change in their plans,” says George Passela, executive vice president and CFO of M3 Midstream/Momentum, Houston, Texas. Passela is referring to Chesapeake’s agreement, announced June 8 hours before its turbulent annual shareholders meeting, to sell its subsidiaries, Chesapeake Midstream Partners LP and Chesapeake Midstream Development LP, to Global Infrastructure Partners for $4 billion.

 

“We are moving rapidly to the point where we will begin construction. I think we anticipate that will kick off in August,” Passela says.

 

READ MORE AT:

http://businessjournaldaily.com/drilling-down/utica-processing-plants-track-august-start-2012-6-14

Chamber: Shale money is flowing

July 13, 2012

By DAN POMPILI - reporter ([email protected]) , Tribune Chronicle | TribToday.com

 

An official with the Regional Chamber says recent news of shale-related investments should give Valley residents confidence in the industry.

 

....Dallas-based Caiman Energy announced this week that it is investing $800 million to develop sections of the Utica Shale that contain oil and heavier liquids like propane and butane.

 

A midstream energy company, Camain provides infrastructure and other services to get natural gas products from the wells to the marketplace.

 

Meanwhile, NiSource Gas Transmission and Storage's Midstream and Minerals Group, LLC announced a $300 million investment with Houston-based Hilcorp Energy Co. to develop oil and gas in the Utica/Point Pleasant Shale formation. That team also plans to construct new pipelines and natural-gas liquids processing facilities to support production in the region. NiSource is based in Merrillville, Ind.

 

READ MORE AT:

http://tribtoday.com/page/content.detail/id/574068/Chamber--Shale-money-is-flowing.html?nav=5021

Ellwood Crankshaft Group Plans to Invest $225 Million

Wednesday, July 11, 2012

By Dan O'Brien

 

HERMITAGE, Pa. -- A manufacturer here is cranking out more business than ever, thanks in part to aggressive oil and gas exploration in shale formations across the country and a rejuvenated market for the locomotive industry.

 

“We’re fortunate enough to be in the right place at the right time,” says Brian Taylor, president of Ellwood Crankshaft Group, which operates two plants in Hermitage and two others in Irvine, Pa., and Cleveland. The company’s largest Hermitage operation, Ellwood Crankshaft and Machine, manufactures, fabricates and machines industrial crankshafts used in the marine, oil and gas compression, locomotive and other specialty industries.

 

“We’ve always participated in all of the shale plays,” Taylor reports, especially in Texas and North Dakota. But recent activity in the Utica play in eastern Ohio and the Marcellus shale in western Pennsylvania has led to increased demand from oil and gas processors that need Ellwood’s crankshafts for its compressor stations.  “We’ve produced a lot of crankshafts over the last two years for these areas.”

 

READ MORE AT:

http://businessjournaldaily.com/company-news/ellwood-crankshaft-group-plans-invest-225-million-2012-7-11

Selling like hot cakes

Eateries seeing uptick in business

 

July 15, 2012

By LARRY RINGLER - Business Editor ([email protected]) , Tribune Chronicle | TribToday.com

 

WARREN - From "landmen" poring over property deeds in the Trumbull County courthouse to educators training workers to weld pipe and run machinery, the growing natural gas shale industry is creating the first wave of jobs.

 

Of course, they have to eat, which has restaurant owners, well, salivating over new business. The result is extra sales tax dollars for local county coffers and new taste treats for customers from the likes of Firebirds Wood Fired Grill, coming to the Eastwood Mall in Niles later this year.

 

"A lot of people who work for shale companies are helping restaurants, particularly downtown restaurants, because they're doing a lot of work at the courthouse," Nick Liakaris, an owner of the Mocha House on High Street N.E., said about the steady rise in business out of the Great Recession.

 

READ MORE AT:

http://www.tribtoday.com/page/content.detail/id/574131/Selling-like-hot-cakes.html?nav=5358

Shale gas, return of domestic manufacturing could lead to economic boost

By FRANK ESPOSITO

9:39 am, July 17, 2012

 

The American economy should post modest growth through 2014, in part because of the country's manufacturing base getting a boost from development of shale gas and related products — including rubber, plastics and chemicals.

 

Rubber and plastics are among several industries that are on the brink of returning work to North America from Asia, according to speakers at a manufacturing conference hosted by the National Association for Business Economics, held recently in Cleveland.

 

U.S. gross domestic product should grow a little more than 2.5% this year and 3% in 2013 and 2014, according to Sandra Pianalto, president and CEO of the Federal Reserve Bank of Cleveland.

 

READ MORE AT:

http://www.crainscleveland.com/apps/pbcs.dll/article?AID=/20120717/FREE/120719846/1225/newsletter04

Stark County well’s oil production has CEO gushing

An energy company chief executive is touting a Stark County well’s early oil production, saying it rivals highly publicized wells in Texas.

 

The Frank well, off state Route 619 in Marlboro Township, is producing 515 barrels of energy equivalents a day — and with a desirable high liquid content and little natural gas, Mark Houser, chief executive of Texas-based EV Energy Partners LP, said in a company report to industry analysts.

 

He said 40 percent of the equivalents are in light crude oil and 40 percent are in natural gas liquids, including ethane and propane. Low prices for natural gas have resulted in energy companies turning more attention to oil and gas liquids that can produce more revenue.

And if this pans out, watch out.

An industry analyst told an Akron audience Monday that Ohio could become a major oil state thanks to the Utica shale.

 

Steve Fillingham, of Colorado’s Energy Analysts International Inc., said Ohio could produce 250,000 barrels of oil a day, perhaps as many as 500,000 barrels.

This was a very good event. It was good to hear the other speakers....

 

Projected Utica shale growth a ‘game changer’ for Ohio, speakers say

By Jim Mackinnon

Beacon Journal business writer

Published: August 13, 2012 - 10:10 PM

 

Charmaine Horvath didn’t go to Firestone Country Club early Monday morning to hit golf balls on the famed course.

 

Instead, Horvath sat with about 100 people inside a large meeting room at the club to learn about how newly accessible — and apparently vast — supplies of oil and natural gas thousands of feet underground in the Utica shale could change people’s lives and grow Ohio’s economy.

 

“I’m just excited. I don’t think the majority of people in this area understand what is going on right now,” the Akron resident said. “And I think they need to know.”

 

The Utica shale was the topic for the 15th Northeast Ohio Logistics Conference & Golf Open. The event was sponsored by the Northeast Ohio Trade & Economic Consortium and the Port of Cleveland. Many of the participants attended to find out how their businesses can become part of the Utica shale supply chain.

 

READ MORE AT:

http://www.ohio.com/business/projected-utica-shale-growth-a-game-changer-for-ohio-speakers-say-1.326940

I keep reading stories about companies based out of W Virginia or Texas or wherever. What percentage of leases and drilling is done by local companies? I'd like to revenue and profits stay in the area. Cleveland grew up by having steel, oil, and large banks headquartered here. Doesn't have near the long lasting affect on the area if profits are going to Houston, or worse overseas to BP.

What local have experience in drilling? None. Why? How would they have gotten it? This is so new that the first shale gas well wasn't drilled in this region until 2003 (Washington, PA). All of the expertise and thus the corporate offices, workers, etc. are based in Texas, Oklahoma and Louisiana. West Virginia officials are wanting local people hired as employees, but they are usually for unskilled labor because they have no experience. This is so new and the demand for skilled employees is so great that geology and energy engineering university students are being hired for $100,000 from area universities, like Marietta, Pitt and others -- a year before they graduate.

 

And as long as there's the threat of regulation or moratoriums or other governmental activities that could bring all this to a halt, they aren't even going to buy houses here. One of the speakers noted that energy company executives and managers are renting houses here rather than buying. And workers are being housed in former office buildings or schools that were renovated into housing. That's rental housing.

 

It's going to take some time to ramp this region's capacity to do this themselves. When we began mining coal in Ohio, Pennsylvania and West Virginia in the early 1800s, we had to bring in skilled workers from overseas, especially Scotland and England who had experience in mining. Same thing is happening now.

 

This is a decades-long process.

I agree that this is a long-term thing.  The physical capital and human capital (i.e., educated workforce with experience specifically in this field) is going to take a long time to get in place, and there are definitely legislative and regulatory risks that could completely annihilate that gradual capital buildup in the meantime.

 

Honestly, I think the best bet for a local company to enter into this arena would be as a spinoff from one of the larger national players, or a new startup from mid- to senior-level people there who want to branch out on their own (assuming they can do so without running afoul of noncompetes in their contracts with their current shops).

Big news for local economy

September 9, 2012

Tribune Chronicle | TribToday.com

 

A flurry of announcements last week point again toward a Mahoning Valley economic resurgence that, after scratching beyond the surface, looks even rosier.

 

One ''little'' announcement is a $10 million Comfort Inn and banquet center in Liberty, on the site of the old Ramada Inn. It's one of many hotels announced or hinted at recently, including a large complex connected to the Eastwood Mall in Niles and a potential hotel at U.S. Route 422 and I-80 in Girard. Hotel operators anticipate an influx of oil and natural gas workers will book rooms for years.

 

One giant announcement is a $1.5 billion natural gas pipeline originating in Eastern Ohio, maybe Trumbull County, and extending to Michigan, then around Lake Erie into Canada. The pipeline, being developed by Enbridge Inc., DTE Energy and Spectra Energy Corp., may originate further south but will run through Columbiana, Mahoning and Trumbull counties.

 

READ MORE AT:

http://www.tribtoday.com/page/content.detail/id/576344/Big-news-for-local-economy.html?nav=5007

Railroads Ready for Utica Shale Midstream Hauling

Monday, September 10, 2012

By Dan O'Brien

 

YOUNGSTOWN, Ohio – Executives of national and regional railroad companies say they have a role to play as oil and gas companies develop the Utica shale in Eastern Ohio.

 

Many of these big energy companies that have entered the region are still trying to define the play and are just beginning to map and build the pipelines needed to take their products to markets across the country.

 

Meantime, railroads have a robust infrastructure in place and are ready to handle the heavy loads of materials and products to and from the well sites, executives say.

 

"We've got a pretty good network in the Utica, from Youngstown to the Ohio River," said Ryan Fischer, assistant vice president, emerging markets, Genesee & Wyoming Inc., one of the largest regional/short-line railroads in the United States.

 

READ MORE AT:

http://businessjournaldaily.com/drilling-down/railroads-ready-utica-shale-midstream-hauling-2012-9-10

Utica Midstream Development Much More than Talk

Friday, September 21, 2012

By Dan O'Brien

 

YOUNGSTOWN, Ohio -- There’s talk of new companies relocating here. There’s talk of new jobs. And, there’s talk of new revenue streams for businesses that can supply and support an industry that stands to change the landscape of eastern Ohio.

 

What’s different this time is that for all the talk, there’s physical evidence that it’s happening – and happening very quickly.

 

“We’ve been working on grading the site, and that’s nearing completion,” says George Francisco, executive vice president at Houston-based M3 Midstream. M3 and its venture partners is beginning construction of a large natural gas processing plant in the tiny town of Kensington in Columbiana County. “The first phase will be finished and in service sometime in June.”

 

READ MORE AT:

http://businessjournaldaily.com/drilling-down/utica-midstream-development-much-more-talk-2012-9-21

...

And as long as there's the threat of regulation or moratoriums or other governmental activities that could bring all this to a halt, they aren't even going to buy houses here. ..

Miners own trailer homes and have them towed away when the resources are gone.  All that left is a trailer park with a sewage plant as their legacy for future generations.

Things have slowed down.  Most of the people involved in the title and leasing aspect of this have been laid off.  Last winter was so warm that natural gas prices collapsed and it's no longer profitable to drill.  The entire industry is on hold until: a) prices rise, and b) Chesapeake's fate becomes more clear.

^

Natural gas prices were in the gutter earlier in the year and late last year when leasing was at a frenzy. I'm pretty sure the culprit is a collapse of natural gas liquids prices. The only viable areas left are going to be ones in the oil window, at least until either NG or NGL prices recover (both of which could take a while).

 

But here's a prediction I'm going to make:

 

First, the EIA reported today that US domestic oil production last week reached the highest since early 1997. Note that oil prices tumbled today after the report came out, and have been tumbling the past week or two, likely in response to the surge in supply. The EIA is projecting US oil production will average 6.8 million barrels/day next year, which would be the highest since 1992. Longer-term projections I've read say US production could reach 7 million barrels/day by 2015, and maybe 8-10 million barrels/day by 2020 or 2030. Those farther-out predictions may or may not be optimistic, but regardless, US production is going up in the short and medium term.

 

Second, couple that with the fact Obama recently signed legislation ramping up CAFE standards significantly in stages by 2025. You'll have a situation where supply is going up, while demand is going down or remain flat. Guess what will happen?

 

Somewhere around 2014-17 or thereabouts I think you're going to have a crash in oil prices, regardless of what the economy is doing. This may or may not be confined to North America, hard to say. The drillers producing oil in plays like the Utica, Bakken and Eagle Ford shales will have a hard time making money since these plays require higher oil prices to be profitable. Unless ... new technologies like Super Fracking can be perfected and adopted on a widespread scale before then, in which case they should be OK. If not, a lot of these companies are going to go belly-up and/or you'll see a large wave of industry consolidation (might already be starting, frankly). Drilling will slow down to some extent, but as is happening with natural gas the past year or two, even though prices are less than the cost to drill, these companies will essentially be forced to drill, for the simple reason that that's what they do. It's not like Chesapeake Energy can diversify into the woman's handbag industry if it can't make money drilling natgas, NGL's or oil; they'll have no choice but to continue drilling, which will drag out the glut over a much longer period of time than anyone in the industry would be comfortable with.

 

Consumers, of course, will greatly benefit from all this in the meantime, as will refiners and petrochemical producers. Hard to say when, but maybe around 2018-2025 prices of oil will rebound as the glut is burned off (pun intended), unless Super Fracking and other new technologies really take off. Dry natural gas and NGL prices could rebound before that. Anyway, the industry is going to look a lot different in 2020 than it does now.

I have a question because I'm just ignorant to how this works. I'm a big fan of this new Ohio energy development. I just want to know if and how this would positively impact Cleveland. Will it impact indirectly as a benefit of Ohio's economy as a whole, or is there a more direct positive economic impact?

I have a question because I'm just ignorant to how this works. I'm a big fan of this new Ohio energy development. I just want to know if and how this would positively impact Cleveland. Will it impact indirectly as a benefit of Ohio's economy as a whole, or is there a more direct positive economic impact?

 

My first reaction was to say that Cleveland is not jumping on this as aggressively as other areas like Youngstown, Warren or Canton. But those areas are going after big-ticket projects because they can -- processing plants, crackers, and related plants need to be right in the midst of where the production is occurring. But spin-off manufacturing can and will occur anywhere, although the closer the better. And there's where Cleveland seems to be grabbing spin-off business, such as making pipeline components, gas compressors, sealants, valves, machine tools, etc etc. The Greater Cleveland Partnership is very aware of this and trying to grab what they can in terms of business expansions and make local manufactures aware of opportunities.

Consumers, of course, will greatly benefit from all this in the meantime, as will refiners and petrochemical producers. Hard to say when, but maybe around 2018-2025 prices of oil will rebound as the glut is burned off (pun intended), unless Super Fracking and other new technologies really take off. Dry natural gas and NGL prices could rebound before that. Anyway, the industry is going to look a lot different in 2020 than it does now.

I love cheap gas as much as the next person. But keep in mind much of that extra production in the US is going overseas. There's always some excuse.

There were recently two flights added to Hokins Airport directly as a result of oil business people traveling frequently between here and Oklahoma. Two flights may not seem like much, but they help to keep Hopkins a United Hub, which is critical for the Cleveland business community.

I have a question because I'm just ignorant to how this works. I'm a big fan of this new Ohio energy development. I just want to know if and how this would positively impact Cleveland. Will it impact indirectly as a benefit of Ohio's economy as a whole, or is there a more direct positive economic impact?

 

My first reaction was to say that Cleveland is not jumping on this as aggressively as other areas like Youngstown, Warren or Canton. But those areas are going after big-ticket projects because they can -- processing plants, crackers, and related plants need to be right in the midst of where the production is occurring. But spin-off manufacturing can and will occur anywhere, although the closer the better. And there's where Cleveland seems to be grabbing spin-off business, such as making pipeline components, gas compressors, sealants, valves, machine tools, etc etc. The Greater Cleveland Partnership is very aware of this and trying to grab what they can in terms of business expansions and make local manufactures aware of opportunities.

 

That's great to hear.  I've been wondering if Cleveland would be able to benefit in one way or another based on location (and the port, which may or may not be of benefit).

 

There were recently two flights added to Hokins Airport directly as a result of oil business people traveling frequently between here and Oklahoma. Two flights may not seem like much, but they help to keep Hopkins a United Hub, which is critical for the Cleveland business community.

 

Also good to know that flights into and out of Hopkins are being added based on the location of the airport.

McDonald land could be used for plant

Published: Sun, October 7, 2012 @ 12:09 a.m.

 

By Ed Runyan

 

[email protected]

 

McDONALD

 

Mayor Glenn Holmes, real estate agent Dan Crouse and several unnamed investors are betting that 199 acres now owned by Lafarge Construction Materials could be a prime location for a gas and oil processing facility.

 

Holmes says the land, which is a slag yard that once served steel mills all along the nearby Mahoning River, has all the elements to make it a great location for a “cracker plant.”

 

A cracker plant converts — or cracks — ethane, a byproduct of natural-gas production, into chemicals that can be used to make a range of plastic products.

 

READ MORE AT:

http://www.vindy.com/news/2012/oct/07/mcdonald-land-could-be-used-for-plant/

 

 

AND

 

 

McDonald site may go midstream

Considered for cracker plant

October 7, 2012

By BRENDA J. LINERT - Business Editor ([email protected]) , Tribune Chronicle | TribToday.com

 

McDONALD - Hundreds of available acres, miles of rail line, a convergence of 200 miles of pipeline rights of way, a water supply, a web of highways and what is believed to be vast amounts of natural gas deep below the earth's surface have local developers and political leaders thinking big thoughts about the tiny river town of McDonald.

 

''They are speculating it would be a great spot for a petroleum chemical plant,'' McDonald Mayor Glenn Holmes said last week. ''The way it's strategically located on (state) Route 11, they could bring pipeline right into the site.''

 

The 210-acre property owned by U.S. Steel and LaFarge North America is being marketed by Routh-Hurlbert Real Estate brokers Dan Crouse and Chuck Joseph as land available for a ''Gas Processor / Cracker.''

 

READ MORE AT:

http://www.tribtoday.com/page/content.detail/id/577522/McDonald-site-may-go-midstream.html?nav=5358

Things have slowed down.  Most of the people involved in the title and leasing aspect of this have been laid off.  Last winter was so warm that natural gas prices collapsed and it's no longer profitable to drill.  The entire industry is on hold until: a) prices rise, and b) Chesapeake's fate becomes more clear.

 

Chesapeake isn't the only player in this region; they just happen to have leased the most land. I've seen teams of their people in Mahoning, Columbiana, Tusc and Portage that are still running title on their leased lands. There's activity.

 

Chesapeake recently announced that they were going to dump their holdings in NE Ohio which will mean that the purchasing company will have to perform the same due diligence on the leases as Chesapeake did when they signed them, and they'll only have a few years to drill them before they expire. So either something is going to happen within 5 years or someone is going to lose a ton of money.

Things have slowed down.  Most of the people involved in the title and leasing aspect of this have been laid off.  Last winter was so warm that natural gas prices collapsed and it's no longer profitable to drill.  The entire industry is on hold until: a) prices rise, and b) Chesapeake's fate becomes more clear.

 

Chesapeake isn't the only player in this region; they just happen to have leased the most land. I've seen teams of their people in Mahoning, Columbiana, Tusc and Portage that are still running title on their leased lands. There's activity.

 

Chesapeake recently announced that they were going to dump their holdings in NE Ohio which will mean that the purchasing company will have to perform the same due diligence on the leases as Chesapeake did when they signed them, and they'll only have a few years to drill them before they expire. So either something is going to happen within 5 years or someone is going to lose a ton of money.

Please provide details into where you heard that CHK will be dumping all holdings in Ohio.  That's news to me.

 

And as far as the psoter who said things are on hold until gas prices increase, there is a bit of truth to that.  It has definately slowed down.  I saw XTO pulled out of Ohio due to bad flowback also.  Devon had poor results in Ashland and Medina County.  We need to remember these are all E&P's and they are still in the E phase.  There is no production.  We will probably know more on the fate of Ohio NG business mid 2014 if I had to guess. 

My understanding is that they're selling off all but their "core" Ohio holdings, like Columbiana and Carroll Counties.  That may have changed though.  Either way I would be surprised if all the due diligence has to be repeated.  If so, how incredibly wasteful.

^ Here you go.

 

It's not in -all- of Ohio, just mostly in NEO / SE Ohio. This is where the bulk of the activity is. They're still proceeding in the Mahoning Valley and in the Canton area. I think they recently set up a downtown office campus in some of the available office space in downtown Canton.

 

Chesapeake to Sell Utica Assets

 

By: Zacks Equity Research

June 06, 2012 | Comment(s):

 

Embattled Chesapeake Energy Corp. (CHK) is trying hard to minimize capital expenditure through its divestiture program. The company plans to sell 337,481 net acres of Utica-Point Pleasant Trend acreage in Ohio, as per a prospectus released by Denver-based Meagher Energy Advisors.

 

The to-be sold assets include drilling rights in 19 Ohio counties that are mainly situated to its north-east and south-east. Northeast Ohio counties comprise Huron, Lorain, Ashland, Wayne, Summit, Geauga, Portage, Asthabula and Trumbull counties. The southeastern counties are Licking, Muskingum, Fairfield, Perry, Morgan, Washington, Athens, Hocking, Vinton and Meigs.

 

http://www.zacks.com/stock/news/76510/chesapeake-to-sell-utica-assets

My understanding is that they're selling off all but their "core" Ohio holdings, like Columbiana and Carroll Counties.  That may have changed though.  Either way I would be surprised if all the due diligence has to be repeated.  If so, how incredibly wasteful.

 

An oil and gas lease is an interest in property. Every time it's sold, somebody -ought- to run a title search. A savvy home buyer is not going to forgo a title search just because the house changed hands a month ago. There's a lot of money at stake, and title searches are not terribly expensive. I suppose Chesapeake might warrant the sale, but who's to know whether they'll be in business to pay off the buyer for defects in a year?

Be sure to watch Mad Money on Thursday!  :clap:

 

‘Mad Money’ host Jim Cramer coming to Ohio for show on Utica shale

Be sure to watch Mad Money on Thursday!  :clap:

 

‘Mad Money’ host Jim Cramer coming to Ohio for show on Utica shale

 

Bummer. I'll be in Chicago..

Here's a link to the full Mad Money segment on the Utica shale:

Mad Money October 18

Thanks

Discovered a few blogs that keep track of activity in the Utica shale.

 

This one doesn't seem to be very active, but...

http://www.uticashaleblog.com/

 

Ohio.com's Utica shale blog:

http://www.ohio.com/blogs/drilling

 

And this one covers both the Marcellus and Utica shales:

http://gomarcellusshale.com/

 

Blogs by people who know a lot about the industry can often be more informative than anything printed in the regular media.

 

And I have no idea why they made this estimate so early (industry immediately said the numbers were too low), but the USGS recently came out with an assessment of the "technically recoverable, undiscovered" amount of oil and gas in the Utica (includes the PA portion).

 

38 trillion cubic feet of natural gas and 940 million barrels of oil

 

Those are decent numbers (especially the natgas), but there's been so little drilling to date I don't know why they bothered, aside from political pressure to do so.

Cross-posted from the rail thread.......

 

Rail to the river

Proposed project would bring old tracks back to life

October 21, 2012

By BRENDA J. LINERT , Tribune Chronicle | TribToday.com

 

Area development officials, rail advocates and a Boardman businessman are exploring whether 13 miles of defunct rail line in southern Columbiana County could be redeveloped to create a direct freight-shipping link from Trumbull and Ashtabula counties to the Ohio River.

 

The project, which could cost upward of $100 million, has gained the attention of a statewide group focused on boosting rail use, an official with the Western Reserve Port Authority and even a local entrepreneur who says funding should not be a problem.

 

The supporters believe that a direct rail link would be a more favorable shipping route for products linked to the natural gas drilling industry, and could help secure other midstream processing and manufacturing plants in the area.

 

READ MORE AT:

http://www.tribtoday.com/page/content.detail/id/578153/Rail-to-the-river.html?nav=5021