OSU PROFESSOR’S VIEW

Study doubts shale gas to be job gusher

By  Mark Williams

The Columbus Dispatch Friday December 16, 2011 7:07 AM

 

The huge discoveries of natural gas and oil just starting to be tapped in eastern Ohio are expected to generate jobs — but only a fraction of the number that the industry forecasts, according to a report led by an Ohio State University professor.

 

The study released yesterday predicts that the boom in drilling will lead to 20,000 new jobs over the next several years, far fewer than the 200,000 that the industry has predicted will come from drilling in shale formations for oil and gas. The 20,000 jobs would be those created both directly and indirectly from drilling.

 

“We need to be setting realistic expectations,” said Mark Partridge, an economics professor specializing in urban and rural development at Ohio State. He led the study with doctoral student Amanda Weinstein.

 

READ MORE AT:

http://www.dispatch.com/content/stories/business/2011/12/16/osu-study-doubts-shale-gas-to-be-job-gusher.html

....But apparently V&M, US Steel, Republic and now Timken are gushing....

 

Timken reaches new contract with steel workers union, clears way for $225 million expansion

Published: Thursday, December 15, 2011, 7:28 PM    Updated: Thursday, December 15, 2011, 7:38 PM

  By Robert Schoenberger, The Plain Dealer

 

CLEVELAND, Ohio -- Timken has reached a new contract with the United Steel Workers in Canton, clearing the way for a major expansion of the company's Faircrest Steel Plant.

 

Terms of the new contract were not disclosed, and workers must approve the deal before it becomes final.

 

The five-year contract would replace and existing deal set to expire in 2013. When it announced that it was considering a plant expansion, Timken said it was looking for a stable work environment with its workers.

 

READ MORE AT:

http://www.cleveland.com/business/index.ssf/2011/12/timken_reaches_new_contract_wi.html

Anecdotal tidbit sort of related to the article.  A few years ago my friend worked as drilling site geologist based out of Charleston, WV. He said they had a hell of a time staffing the rigs. He said the guys would come out of the hills work long enough to collect a paycheck or two and then disappear. I am not surprised that they are bringing in out of state workers.

 

 

When was the last time some of these regions saw new families arriving, let alone immigrants? Perhaps this situation should have been expected but it's sad that some people don't welcome change.....

 

HOPPY KERCHEVAL

Thursday December 1, 2011

Does W.Va. labor want jobs or doesn’t it?

Reflexive hostility to business hurts workers in the end

 

Maybe West Virginia has gotten so used to economic failure that it's having trouble handling a little success.

 

The Marcellus shale gas boom has increased the demand for workers  in drilling and related industries in the state, but the frequent complaint is that these companies are not hiring enough West Virginia workers.

 

Anecdotally, you hear grumbling about all the out-of-state license plates and workers who aren't from around here. Some of the carping is even tinged with bigotry because of an influx of Hispanic workers.

 

READ MORE AT:

http://dailymail.com/Opinion/HoppyKercheval/201111300173

Gas, oil boom boosts real-estate markets

By Edd Pritchard

CantonRep.com staff writer

Posted Dec 19, 2011 @ 07:00 AM

   

When they bought Palmantier’s Motel in August 2010, Rainie and Earl Sonntag liked the idea of saving a landmark.

 

The couple had experience running a small hotel and hoped to succeed with the property, but they didn’t expect the help they would get because of renewed interest in drilling for oil and natural gas in eastern Ohio.

 

Business started slow when the Palmantier reopened. “The shale guys came in, and it boomed,” Rainie said.

 

The real estate business — commercial property, housing sales and house and apartment rentals — is receiving a boost because oil companies are eager to pull oil and natural gas from the Utica shale. The rock formation lies about 6,000 feet below the surface and many speculate that drilling the Utica shale could lead to energy independence for the United States.

 

Read more at: http://www.cantonrep.com/news/x1658261569/Gas-oil-boom-boosts-real-estate-markets

http://www.policymattersohio.org/beyond-the-boom-press-dec2011

 

Ohio should raise severance tax on shale gas

Revenue would help cover public costs, report finds

 

For immediate release, Monday, December 19, 2011

Contact Wendy Patton at 614.221.4505

 

If Ohio levied a severance tax on oil and gas at rates similar to neighboring states, it could generate up to $538 million in new revenues between now and 2015. These funds would help with the up-front, public costs of the anticipated drilling and lay the groundwork for a strengthened economic future. In a paper released today, “Beyond the Boom: Ensuring adequate payment for mineral wealth extraction,” Policy Matters Ohio recommends that the state raise its severance tax on oil and gas to 5 percent of value, equal to the rates in West Virginia and Michigan.

 

“Ohio’s severance tax is one of the lowest among states with potential to produce oil and gas from shale,” said Wendy Patton, author of the new report and senior project director at Policy Matters. “Part of preparation for the coming boom should include raising the severance tax rate to a level consistent with other energy states.”

 

States with significant reserves of natural shale gas include Texas, with a severance tax rate of 7.5 percent; Oklahoma, 7 percent; and Arkansas, Michigan and West Virginia, 5 percent. Louisiana has a rate on volume of gas produced of $.16 per thousand cubic feet (mcf). Pennsylvania currently has no severance tax, but is considering one.

 

Ohio’s rate on volume of gas produced is $.025 per mcf (with an additional $.005 for conservation). The effective severance tax rate on natural gas over the past decade has been less than half of 1 percent. The situation for oil is similar, with Ohio’s rate of $.10 per barrel, (with a matching conservation fee) at the low end among states with a severance tax on oil and an average effective severance tax rate over the past decade of less than one fifth of 1 percent of value.

 

States with high production of minerals use the severance tax to compensate for depletion of natural resources. The revenues strengthen and stabilize public services that build the economy of the future, including schools and higher education. The tax is deductible from federal taxes, which softens the impact on producers. Ohio ranks 25th in severance tax collections among the 35 states that collect such a tax, yet 19th in production of natural gas and 17th in oil production.

 

Horizontal drilling and hydrofracturing (‘fracking’) are expected to significantly boost drilling in Ohio. Fracking, which uses millions of gallons of water laced with chemicals and other additives, is exempt from the federal regulations, yet is suspected of pollution in watersheds and aquifers. Costs associated with increased drilling activity as well as with pollution may impact state and local finances, while the level of benefits predicted by the industry may not materialize.  The so-called ‘natural resources curse’ of places rich in minerals but with low in per-capita income -  from West Virginia and Louisiana to Nigeria – warns of trouble beyond the boom.

 

“Many mineral-rich states dedicate their severance tax collections to trust funds that finance services during drilling and strengthen the state once minerals are depleted,” said Patton. “The severance tax is how energy states ensure impacted communities are protected and wealth invested to create a better future for all residents.”

 

END

Huge amounts of public money had to be spent to seal abandoned coal mines leaking acid into the streams of Appalachia.  I expect the gas and oil industry is going to cause the public to pay to remediate the damage they will cause. 

Boosting tax on oil, gas rates would mean $538M for Ohio, report says

Published: Tue, December 20, 2011 @ 12:00 a.m.

By Karl Henkel

[email protected]

 

YOUNGSTOWN--Ohio could generate $538 million in revenues by 2015 if it imposed a higher tax on oil and gas rates, according to a new report from Policy Matters Ohio.

 

Wendy Patton, author of the new report and senior project director at Policy Matters, with offices in Columbus and Cleveland, said that by aligning severance taxes with that of nearby states, Ohio could benefit financially from new drilling operations.

 

“Ohio’s severance tax is one of the lowest among states with potential to produce oil and gas from shale,” she said. “Part of preparation for the coming boom should include raising the severance-tax rate to a level consistent with other energy states.”

 

Texas has a severance tax rate of 7.5 percent; Oklahoma, 7 percent; and Arkansas, Michigan and West Virginia, 5 percent.

Read more at: http://www.vindy.com/news/2011/dec/20/boosting-tax-on-oil-gas-rates-would-mean/

Kasich Vows 'Tough' Shale Regulation

Dec. 20, 2011 7:02 a.m.

By George Nelson

 

YOUNGSTOWN, Ohio -- Gov. John Kasich said Monday "tough and clear regulations" will be put in place governing the emerging shale gas industry in Ohio, and stressed the industry's impact could reach statewide, not just in the eastern part of the state.

 

The impact of shale plays and how the state plans to address the emerging industry were among several topics the governor addressed at a year-end meeting with reporters at his residence in Bexley.

 

The promised regulation will affect issues such as gathering lines, high-pressure pipelines, the kinds of chemicals used in the exploration and extraction process, "I mean, it's from A to Z," Kasich said during the news conference, which was streamed on the web.

 

READ MORE AT:

http://business-journal.com/kasich-vows-tough-shale-regulation-p20640-1.htm

Cross-posted from the Youngstown-Warren projects thread. I'd heard about this plant but was told it would be a large facility that would produce more jobs than this. But 103 added jobs is just fine....

 

Exterran Energy to Build $13.2M Plant

Dec. 20, 2011 7:02 a.m.

By George Nelson

 

YOUNGSTOWN, Ohio -- A Houston company that manufactures equipment for the natural gas industry wants to locate on 20 acres of city-owned property where Exal Corporation had planned a $400 million expansion, but city and Exal officials say that doesn't put an end to that project.

 

Exterran Energy Solutions LP plans to build a $13.2 million, 65,000-square-foot plant at the Salt Springs Industrial Park, where it would employ 103 workers, according to legislation to be considered Wednesday by City Council.

 

Exterran designs and builds equipment used to compress natural gas. Its parent, Exterran Holdings Inc., "serves customers across the energy spectrum -- from producers to transporters to processors to storage owners," according to its website. The company has more than 10,000 employees and operates in 30 counties.

 

READ MORE AT:

http://business-journal.com/exterran-energy-to-build-m-plant-p20641-1.htm

Fortune 500 oil and gas company moving to Massillon

By Matthew Rink

IndeOnline.com staff writer

Posted Dec 23, 2011 @ 07:16 PM

 

MASSILLON — A multi-billion-dollar, Fortune 500 supplier to the oil and gas industry has leased a vacant distribution center in the city as energy companies ramp up efforts to tap the Utica shale reserves for natural gas.

 

National Oilwell Varco, a Houston-based company, will occupy the former home of PolyOne Distribution Inc., 4075 Millennium Blvd. SE,  a 72,000-square-foot building with an additional 5,000 square feet of office space, according to Mayor Frank Cicchinelli.

 

A press release announcing the lease does not state the company’s identity, and Doug Sibila of Sibila Family LLC, the building’s owner, would neither confirm nor deny National Oilwell Varco as the new tenant. Sibila said the tenant has asked to keep a “low profile.”

 

READ MORE AT:

http://www.cantonrep.com/news/x1282423996/Fortune-500-oil-and-gas-company-moving-to-Massillon

This is the first place I've seen give an estimate about how much oil this will produce: Current guess is 200,000 barrels/day by 2020. That's about as much as Oklahoma is producing now.

 

Chevron And Anadarko Gear Up For Fracking Fest In Ohio

Shale deposits in Ohio have drawn significant interest from major industry players owing to the locations suitability. Ohio, once the home of Standard Oil, has a well-connected network of pipelines and waterways that help transport output to the markets with ease.

 

Transportation has been a major bottleneck for the shale industry development in the Bakken shale in North Dakota where producers have to rely on the intermittent rail transport. The state of Ohio is expected to produce 200,000 barrels of crude/day by 2020, helping Chevron and other players improve their domestic production.

 

In addition to strong infrastructure, Ohio also has a favorable geology which allows the waste water generated from hydraulic fracturing to be injected underground. [1] This is a major relief for drillers who do not have this option in plays in Pennsylvania where waste water has to be processed and let into rivers causing problems.

 

Some explorers have resorted to transporting the waste water to Ohio so that it can be injected into the ground.

A very thorough article. And only one of the three Ohio counties (Ross) with frack sand is still served by rail today. RESTORE those tracks today! And the only way you can affordably get sand to Ohio is by water. Problem is there isn't a single water port in Ohio served by a short-line freight railroad....

 

Ohio sand turns to gold as drilling boom comes to Buckeye State

By Bob Downing

Beacon Journal staff writer

Published: December 26, 2011 - 12:35 AM

 

His family-owned company produces the special sand needed for the drilling boom in Ohio’s deep layer of Utica shale.

 

The sand is perfect for the hydraulic fracturing process — or fracking — which uses force to open cracks in the shale and free up natural gas, oil and other lucrative products.

 

The sand is nearly 100 percent quartz. It is round and spherical. It is hard and strong. It is resistant to water and chemicals. It is a sand that flows almost like a liquid. It can survive heavy pressures deep underground.

 

READ MORE AT:

http://www.ohio.com/news/local/ohio-sand-turns-to-gold-as-drilling-boom-comes-to-buckeye-state-1.252220

Not at all good news about one of the biggest shale gas & oil explorers...

 

Oil giant's shell game nets elderly farmers

Promises made, but not kept, and it's all legal

 

Late in the summer of 2010, hundreds of farmers in northern Michigan were fuming.

 

All had signed leases with local brokers permitting drillers to tap natural gas and oil beneath their land. All were demanding thousands of dollars in bonuses they had been promised in exchange. But none knew for certain whom to go after.

 

That's because the company rejecting their leases hadn't signed them to begin with. In fact, the company issuing the rejections wasn't much of a business at all. It was a shell company - a paper-only firm with no real operations - called Northern Michigan Exploration LLC.

 

One jilted land owner, Eric Boyer-Lashuay, called to complain to the broker who had handled his lease. Northern, he recalls saying, is "a shell company ... a blank door with no one behind it."  Today, he puts it this way: "It was all a fake, all a scam."

 

Northern has voided hundreds of land deals, and was indeed a facade - a shell company created so that one of America's largest energy companies could conceal its role in the leasing spree, a Reuters investigation has found. Oklahoma-based Chesapeake Energy Corp., the nation's second-largest gas driller, was behind the entire operation.

 

Read more at:http://www.msnbc.msn.com/id/45804987/ns/business-us_business/#

Reuters/By Joshua Schneyer and Brian Grow:

 

Others, including Chesapeake, defend the need to use shell companies and front companies - contractors with local ties who do business on behalf of a larger corporation. John Lowe, a professor of energy law at Southern Methodist University, calls it "business as usual."

 

"Shells aren't just a device to pull the wool over land owners' eyes," Lowe says. "You have to weigh some of the unfortunate cases against the fact that these companies can facilitate doing business, making it easier and probably cheaper to obtain leases. If I were a regulator, I'm not sure I'd change anything or try to limit the use of shells."

Disney used numerous shell companies to buy land for Disney World in Florida so that it could get the land at lower prices.

The Youngstown media is picking up on the story....

 

Reuters Investigates Chesapeake’s Shells

Dec. 29, 2011 6:54 a.m.

Youngstown Business Journal

 

YOUNGSTOWN, Ohio -- Chesapeake Energy Corp.'s use of shell companies to secure leasing rights in Northern Michigan -- land deals the shell company later voided, allegedly "after Chesapeake learned a well it drilled in the state had come up dry" -- is the subject of an investigative report published late Wednesday by Reuters.com.

 

"Chesapeake's effort to hide its involvement isn't illegal," the story points out, and the practice is common in the energy industry.

 

What Reuters describes as a short-lived "land-lease frenzy" centered on the Collingwood Shale area in northern Michigan, where Chesapeake's shell company, Northern Michigan Exploration, spent $400 million to acquire drilling rights by hiring local companies to negotiate with landowners without disclosing Chesapeake's involvement.

 

Read more at: http://business-journal.com/reuters-investigates-chesapeakes-shells-p20677-1.htm

Environmental groups express concern about wastes from drilling process

 

By Bob Downing

Beacon Journal staff writer

Published: December 30, 2011 - 01:15 AM

 

Environmental groups concerned about possible hazards created through oil and gas exploration want state rules changed to keep low-level radioactive drilling wastes out of Ohio’s landfills and also want an increase in state oversight of such wastes.

 

The Ohio Environmental Council, the Sierra Club, the Buckeye Forest Council and Citizens for Health Environment and Justice made their request to the Ohio Department of Natural Resources in a 10-page letter dated Dec. 23.

 

No one knows how much radioactive waste from so-called drill cuttings — the rock and earth from below ground contaminated with often-toxic drilling lubricants — might be going into the state’s landfills. Four Ohio landfills, including American Landfill in southeastern Stark County, are accepting such wastes.

 

Read more at: http://www.ohio.com/news/environmental-groups-express-concern-about-wastes-from-drilling-process-1.252766

Valley landowners urged to put lease deals into escrow

Published: Fri, December 30, 2011 @ 12:10 a.m.By Karl Henkel

 

[email protected]

 

Last of a five-part series

 

YOUNGSTOWN -- Oil and gas leases can be quite convoluted.

 

The negotiating process may seem tedious, but signing on the dotted line doesn’t mean the process is complete.

 

The leases themselves don’t stand alone; there’s much more for which a landowner must be aware.

 

To ensure timely and accurate bonus payments, the attorneys have advised many, including those involved in Associated Landowners of the Mahoning Valley, a nonprofit landowner advocacy group, that lease agreements be placed into escrow at a bank.

Read more at: http://www.vindy.com/news/2011/dec/30/landowners-urged-to-put-lease-deals-into/

Quakes from fracking

 

http://www.vindy.com/news/2011/dec/31/magnitude-40-earthquake-shakes-valley/

 

Officials from the Ohio Department of Natural Resources think that waste   pumped into the Youngstown-area well,referred to as Northstar No. 1, has been seeping into a previously unknown fault line in eastern Ohio, causing the seismic activity. The moratorium, issued yesterday by Jim Zehringer, the Natural Resources Department’s director, affects four other injection wells.

 

http://www.dispatch.com/content/stories/local/2012/01/01/state-links-quakes-to-work-on-wells.html

 

They told us that there is no risk of the waste fluid leaving the deep bedrock and seeping into the aquifer where people get their well water.  I am skeptical.

I've been told that there have been an increasing number of quakes -- several per week -- in the region. They are weak enough that you can't feel them. But it was a topic of conversation at one business social event in Youngstown attended by a friend of mine. A couple of state officials were talking about them in small groups.

Seems they're growing stronger and closer

This is a pretty controversial issue that is only likely to heat up even more in the coming months and years.

 

I'll be honest, I only have a vague idea of what fracking actually is, but from what I've read, it seems like there are still a lot of unknowns about the process and its effects on the environment.  From contaminated water to earthquakes, it seems like this could cause some serious potential problems for regions that allow it to occur--especially if it's a populated area.  On the flip side, if it proves to be something that can be done safely, it could really provide a boost for Ohio's economy.

 

What are your thoughts on the issue?

 

Wikipedia entry on fracking: http://en.wikipedia.org/wiki/Hydraulic_fracturing

Considering the allegations that fracking causes earthquakes, this is especially interesting:

 

Official: 4 Ohio fluid-injection wells cannot open in wake of quake

by Maggie Schneider

January 1, 2012

 

State leaders have ordered that four fluid-injection wells in eastern Ohio will be "indefinitely" prohibited from opening in the aftermath of heightened seismic activity in the area, an official said.

 

Ohio Department of Natural Resources Director James Zehringer had announced on Friday that one such well -- which injects "fluid deep underground into porous rock formations, such as sandstone or limestone, or into or below the shallow soil layer," the U.S. Environmental Protection Agency explains -- was closed after a series of small earthquakes in and around Youngstown.

 

Then on Saturday, a magnitude 4.0 earthquake struck that released at least 40 times more energy than any of the previous 10 or more tremors that had rattled the region in 2011.

^I'm surprised how little press this has gotten, at least in the south western part of the state. It will be interesting how the ® state gov. handles it. What's a little earthquake and toxic drinking water when there's money to be made(at least for the 1%).

Benwood on verge of ‘economic rebirth’

December 22, 2011

By SCOTT McCLOSKEY - Special to Shale Play , The Herald-Star

 

BENWOOD, W.Va. - A new, $2 million "drilling mud" facility has located in Benwood, bringing further hope of an economic rebirth to the small city.

 

Fluids Management, a Division of AES Drilling Fluids LLC of Houston, Texas, plans to open the multi-million dollar plant in Benwood's Industrial Park before February. More than a dozen large steel containers that will hold the drilling fluids currently are located on a concrete pad several feet thick as construction of the plant continues.

 

Benwood is located along the Ohio River in Marshall County, W.Va., on the city of Wheeling's southern border.

 

READ MORE AT:

http://www.heraldstaronline.com/page/content.detail/id/568087/Benwood-on-verge-of--economic-rebirth-.html?nav=5232

Patriot Positions Itself as Safer Alternative

Jan. 4, 2012 6:30 a.m.

 

WARREN, Ohio -- Patriot Water Treatment LLC is using the ongoing investigation of a possible connection between brine injection wells and recent seismic activity to promote its method of reducing the amount of wastewater disposed of using such wells.

 

Patriot, which accepts low-salinity water used in the hydraulic fracturing, or fracking, process to extract oil and gas from shale reserves, treats that wastewater using a patented process for disposal into the city's wastewater treatment system. Patriot and Warren are in a dispute with the state over the permits that allow it to operate.

 

On Saturday, one day after the Ohio Department of Natural Resources announced an agreement with an affiliate of D&L Energy Inc. to stop disposing of shale drilling waste at its Ohio Works Drive injection well, a magnitude 4.0 earthquake rattled the Mahoning Valley and prompted the state to temporarily halt the disposal of shale-produced waste produced within a 5-mile radius of the D&L Energy well.

 

READ MORE AT:

http://business-journal.com/patriot-positions-itself-as-safer-alternative-p20707-1.htm

^I'm surprised how little press this has gotten, at least in the south western part of the state. It will be interesting how the ® state gov. handles it. What's a little earthquake and toxic drinking water when there's money to be made(at least for the 1%).

 

There's a substantial amount of trickle-down money involved in this too.  Most eastern Ohio landowners aren't in the 1%, plus there's all the blue-collar spinoff work.  I do, however, draw the line at earthquakes.  Luckily our state government does too.  I hope there's a way to prevent that aspect going forward, because I would hate to see so much economic potential fizzle. 

 

Anybody seen the movie Nothing But Trouble, the one about Valkanvania?

^I'm surprised how little press this has gotten, at least in the south western part of the state. It will be interesting how the ® state gov. handles it. What's a little earthquake and toxic drinking water when there's money to be made(at least for the 1%).

 

There's a substantial amount of trickle-down money involved in this too.  Most eastern Ohio landowners aren't in the 1%, plus there's all the blue-collar spinoff work.  I do, however, draw the line at earthquakes.  Luckily our state government does too.  I hope there's a way to prevent that aspect going forward, because I would hate to see so much economic potential fizzle. 

 

Anybody seen the movie Nothing But Trouble, the one about Valkanvania?

 

Which side of the line is contaminated drinking water on for you? 

It may all come down to closing this one (or four)  injection well. All of the seismic activity has been centered in a pretty confined area, given the vast size of the Utica shale formation. Of course treatment and release is also a option, like what is discussed in KJP's article.

 

The seismic issues have shown up in Oklahoma and England too.  There does seem to be a connection.  As for the water, at least in the Youngstown area, it's been shitty forever.  A softener will take the orange out, and the sulfur smell, but it still feels greasy.  I know many disagree, but to me the water concern is more remote.  I favor strong regulations to prevent a situation like the one in Wyoming, but I don't think it's reason enough to shut the whole thing down.

^Oh yeah, the well water around Youngstown is horrible. Before they had city water, my parents opted for a pond because the well water was so horrible. I was just talking about the Youngstown Earthquakes, the Youngstown seismic activity all seems to be centered around the one injection well.

 

 

The Ohio drilling regulations are suppose to be a model for the rest of the nation. At least that is what the ODNR is saying. Triple casing with two layer of drilling mud until several hundred feet below the deepest water table. They also are requiring that all of the brine needs to be stored in tanks, so there aren't going to be containment ponds. The leaking/spilling over  ponds are the major source of the groundwater contamination related to fracking wells, not from leaking wells.

 

IMO this is too important for the area not to resolve.  I am 33 years old and originally from the Youngstown area and I have never seen any kind of economic energy in the area like this. Lots of money coming to town and being spread around. These issue can be resolved and worked through for the mutual benefit for everyone. I am not downplaying the earthquake, I am just saying once they understand what is goin on, they need to come up with a work around.

I wonder how many jobs could be created if they worked on more alternative energies instead of continuing to murder the earth and cause catastrophes like this?

^Hippy (or is it hippie? Whichever is the spelling that doesn't imply that your physique is accomodating for child birth) ;-)

 

I'm w/ CBC on this. I think there is a tremendous amount of economic potential that to just cease and desist is no longer an option. I'm all for regulating what gets pumped into the ground, though. As a general rule, I tend to look askance at any long term process that involves forcing liquid (or gas in the case of 'clean coal') into the earth as a means of storage. There are moving parts down there, and dirt and rock are hardly airtight.

I wonder how many jobs could be created if they worked on more alternative energies instead of continuing to murder the earth and cause catastrophes like this?

 

Unless the government increases its subsidy of alternative energy, nat gas and oil from shale will continue to be more profitable, although I don't quite agree with the hard-line stance in this WSJ editorial:

 

More Brown Jobs

Now foreign investors are betting on America's shale boom

“If President Obama wants to help his re-election chances, he'll stop wasting tax dollars on losers like Solyndra and ‘green jobs' and start talking about the brown jobs that are already multiplying in the private economy.”

http://online.wsj.com/article/SB10001424052970203462304577138754116279584.html

WSJ is trash.  A decade ago they were a lying, militaristic, neocon mouthpiece for the Iraq War.

 

Dems try to counterattack on Solyndra

 

The Republicans backed the California solar company too.

 

Lobbyists with tight GOP connections helped the clean technology start-up company headed by a registered Republican. Arnold Schwarzenegger, California’s former GOP governor, was there for pivotal moments as Solyndra was born. And Solyndra got its federal footing thanks to a program in the 2005 energy law signed by President George W. Bush and passed by a Congress controlled entirely by Republicans.

 

"This loan guarantee was pursued by both the Bush and Obama administrations," said White House spokesman Eric Schultz.

 

Democrats argue they were lulled into complacency by Solyndra executives who said all would be well once they restructured operations. They say they didn’t really start paying attention until this month’s FBI raid on the company and its late August bankruptcy protection filing, which darkened the skies around a poster child of the administration's green jobs agenda

 

Read more: http://www.politico.com/news/stories/0911/63484.html#ixzz1iawsJ3AY

I don't see why tax dollars should subsidize either green or brown energy.  When green energy becomes cost-competitive (and the price of solar panels has indeed been falling, and their performance increasing), it will supplant brown energy through ordinary market action.  And, of course, given that their relative benefits change with fluctuations in commodity prices, the market may well be able to support both, though solar stocks have been getting crushed over the past year or more.

 

As for the shale formations, I'm with 327 above.  There is no reason in principle to oppose the use of natural gas for energy, and great reason to support anything that offers the prospect of economic redevelopment in the Youngstown area and other Appalachian eastern reaches of Ohio--until, of course, we reach the level of possibly causing earthquakes.

 

Yes, many of those areas are not exactly urbanist dreams, and you won't find high-density, mixed-use, white-collar office/retail/residential developments sprouting up around gas wells, but the people in those areas deserve a little chance to see some new industry in the area, too.

 

Incidentally, I'm not sure if anyone has already posted <a href="http://www.dnr.state.oh.us/portals/10/pdf/pg01.pdf">this ODNR map</a> of the distribution of oil and gas fields in Ohio.  As you can see, the resources are largely concentrated in areas that include some of the poorest parts of the state.  They are also largely in areas that probably aren't likely to be the site of any solar panel factories that we attract, either.  (The largest such plant in Ohio that I know of is First Solar's manufacturing plant in Perrysburg.)

If we're going to give up the goods so easily, it would be nice if they at least bought us dinner first (i.e. I'd like to see a few energy companies like Chesapeake and others move their headquarters here or at the very least give us large branch offices with some white collar jobs as well).  I know at least one has done so already, but I'd like to see several more.

 

This isn't really about denying an economic opportunity to citizens in the poorest parts of the state.  This is about making sure that they're not being exploited.  What's the point in having a decent-paying job if 15-20 years down the road you and your family are going to develop serious illnesses because the water and other natural resources in your environment are contaminated?  What's the point in allowing these out-of-state (and out-of-country) companies to come in and steal our resources while paying our residents beans and leaving the bill for the negative externalities for Ohio taxpayers.  If this is as lucrative as some are speculating, then we have to make sure it's done right.

 

Look at how long we've been doing coal mining and the process is still far from perfect and employees are still taken advantage of.

Just to address some of C17 concerns above. The landowners in Mahoning, Trumbull and surrounding counties are well organized on this. They have been aggressive and the leases they are signing are lightyears beyond the old 2 page gas well leases that gave the owners a few bucks a year and  2% of the output. Obviously somebody at Chesapeake and the other gas/oil companies believes that this is going to be huge, because they are putting their money where their mouth is. Huge amounts of cash has been leveraged on this. The leases the land owner groups have negotiated have an unheard high $ per acre and shares of the output above 10%. There have been several land owners in the area that have become millionaires over night based on the leases they signed, and that doesn't include the $ they will get if a well goes into production. There will be a lot more money pouring into the area than if they didn't do anything.

 

Also, these gas wells and renewable energy are not an either/or proposition. I would love nothing more to see Cle-burgh region become a center for all sorts of energy. The demand for fossil fuels is not going to disappear over night. We have the manufacturing expertise to build and supply parts for wind turbines and other renewable energy products, and apparently we have the natural resources to supply gas and oil too. Win-win in my book.

Just to address some of C17 concerns above. The landowners in Mahoning, Trumbull and surrounding counties are well organized on this. They have been aggressive and the leases they are signing are lightyears beyond the old 2 page gas well leases that gave the owners a few bucks a year and  2% of the output. Obviously somebody at Chesapeake and the other gas/oil companies believes that this is going to be huge, because they are putting their money where their mouth is. Huge amounts of cash has been leveraged on this. The leases the land owner groups have negotiated have an unheard high $ per acre and shares of the output above 10%. There have been several land owners in the area that have become millionaires over night based on the leases they signed, and that doesn't include the $ they will get if a well goes into production. There will be a lot more money pouring into the area than if they didn't do anything.

 

Also, these gas wells and renewable energy are not an either/or proposition. I would love nothing more to see Cle-burgh region become a center for all sorts of energy. The demand for fossil fuels is not going to disappear over night. We have the manufacturing expertise to build and supply parts for wind turbines and other renewable energy products, and apparently we have the natural resources to supply gas and oil too. Win-win in my book.

 

I'm cautiously optimistic about the idea, but I don't want our resources to be lining the pockets of some Texans sitting comfortably in Houston far from the environmental risks.  This needs to be an Ohio-centric process.

Just to address some of C17 concerns above. The landowners in Mahoning, Trumbull and surrounding counties are well organized on this. They have been aggressive and the leases they are signing are lightyears beyond the old 2 page gas well leases that gave the owners a few bucks a year and  2% of the output. Obviously somebody at Chesapeake and the other gas/oil companies believes that this is going to be huge, because they are putting their money where their mouth is. Huge amounts of cash has been leveraged on this. The leases the land owner groups have negotiated have an unheard high $ per acre and shares of the output above 10%. There have been several land owners in the area that have become millionaires over night based on the leases they signed, and that doesn't include the $ they will get if a well goes into production. There will be a lot more money pouring into the area than if they didn't do anything.

 

Also, these gas wells and renewable energy are not an either/or proposition. I would love nothing more to see Cle-burgh region become a center for all sorts of energy. The demand for fossil fuels is not going to disappear over night. We have the manufacturing expertise to build and supply parts for wind turbines and other renewable energy products, and apparently we have the natural resources to supply gas and oil too. Win-win in my book.

 

I'm cautiously optimistic about the idea, but I don't want our resources to be lining the pockets of some Texans sitting comfortably in Houston far from the environmental risks.  This needs to be an Ohio-centric process.

 

However if there are no Ohio companies that have any esxpertise in running these type of wells then likely we will be getting out of state companies running them.  That seems most likely.  Hopefully, when ODNR mortgages all of their parkland they can write in certain stipulations regarding local talent. 

 

I would imagine that if a good majority some of these wells begin daily production then the out of state company will bring in white collar staff to support all the blue collar on the well site.  Time will tell how this works out though.

^ Part of the reason the big boys from out of state(Chesapeake, etc) are involved is the that the leases required for a horizontal well start at around  250 contiguous acres, compared to 40 for a vertical well. That requires a lot of cash up front to secure leases, either in the form of swapping/buying leases with other owners or paying out new lease of smaller parcels in aggregate landowner groups (Smaller owners would have been too small before to justify buying the mineral rights from). Chesapeake had to take a $2.5 B influx of cash from a French energy company, in exchange for 25% of the output, just to secure the land rights they felt they needed (and to probably control output for the region as not to kill prices). Apparently the test wells are also producing a lot of valuable liquid hydrocarbons used in plastics that usually have to be refined from crude oil.

Oil, gas lease filing more than quadruples in 2011

CantonRep.com staff report

Posted Jan 09, 2012 @ 07:00 AM

 

CANTON — Companies seeking the potential of the Utica shale drilled only one well in Stark County during 2011, but they lined up thousands of acres for future development.

 

Employees of Stark County Recorder Rick Campbell filed 4,563 oil and gas leases during 2011, more than four times the number processed during 2010.

 

“We’ve never been this busy before,” Campbell said of the leases filed last year.

 

Even with the increased filings during 2010, the surge in new leases filed during 2011 was surprising, he said. “We’re keeping up, but it’s a lot of work.”

 

READ MORE AT:

http://www.cantonrep.com/news/x735289224/Oil-gas-lease-filing-more-than-quadruples-in-2011

A seismic shift in Ohio’s concerns over earthquakes

By  Spencer Hunt

The Columbus Dispatch Monday January 9, 2012 6:10 AM

 

DELAWARE, Ohio — Most people likely had never heard of the Ohio Seismic Network or the state office over it, the Ohio Geological Survey.

 

Until New Year’s Eve, when a magnitude 4.0 quake shook Youngstown.

 

“All of a sudden, the Geological Survey has risen from a totally obscure agency to something where people know who we are,” said Michael Hansen, state seismologist. 

 

Hansen pretty much is the seismic network. The part-time state employee keeps watch over 26 earthquake detectors with an annual budget of $20,000.

 

Read more at: http://www.dispatch.com/content/stories/local/2012/01/09/a-seismic-shift.html

Cross-posted from the V&M Star Steel construction thread.......

 

Youngstown Mayor Discusses Fracking Impact on Jobs

 

Jan. 10 (Bloomberg) -- Charles P. Sammarone, mayor of Youngstown, Ohio, talks with Bloomberg's Mark Niquette about the construction of a $650 million dollar mill in the city thanks to the natural gas drilling boom. The factory for Vallourec SA's V&M Star will have 350 workers and produce seamless pipes used in hydraulic fracturing, also known as fracking. (Source: Bloomberg)

 

SEE THE VIDEO INTERVIEW AT:

http://www.bloomberg.com/video/83944154/

A well-done article on the pluses and minuses of fracking.......

 

Gas Boom Has Youngstown Making Steel Again

By Mark Niquette and Romy Varghese - Jan 10, 2012 12:00 AM ET

 

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.

 

The factory for Vallourec SA (VK)’s V&M Star will have 350 workers and produce seamless pipes used in hydraulic fracturing, also known as 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 two miles (3.2 kilometers) from an injection well for disposing wastewater from fracking that has been closed after 11 earthquakes shook the Youngstown area last year. States that 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.

 

READ MORE AT:

http://www.bloomberg.com/news/2012-01-10/youngstown-opens-mills-again-as-states-jockey-for-fracking-jobs.html

State jobs expert sees oil, gas boom helping the region

January 12, 2012

By Sam Shawver - The Marietta Times ([email protected]) , The Marietta Times

 

The president of JobsOhio believes Southeast Ohio's economy is about to bloom, thanks in large part to projected growthof the oil and gas industry's mining of the state's Marcellus and Utica shale deposits.

 

"The shale opportunities are very interesting-and not just for shale drilling, but for all ancillary industries as well," said Mark Kvamme, president and interim chief investment officer with JobsOhio.

 

The private, nonprofit corporation, assembled by Gov. John Kasich, is focused on job growth and economic development within the state.

 

Read more at: http://www.mariettatimes.com/page/content.detail/id/541298/State-jobs-expert-sees-oil--gas-boom-helping-the-region.html?nav=5002

Youngstown earthquakes raise issues on oilfield wastes from shale exploration

Published: Sunday, January 15, 2012, 9:01 PM    Updated: Monday, January 16, 2012, 6:43 AM

By Aaron Marshall, The Plain Dealer The Plain Dealer

 

COLUMBUS, Ohio -- A New Year's Eve earthquake that shook homes in Youngstown has set off political tremors across Ohio as officials scramble to reassure the public that an expected flurry of drilling in the state won't jeopardize their safety.

 

Columbia University seismic experts have said the injection of hundreds of thousands of barrels of oilfield waste fluids into a fault line probably caused the quake, one of a series of tremors that have rocked the Mahoning Valley.

 

That finding has cracked open a wider debate that goes beyond the controversial process of hydraulic fracturing, or fracking, to its aftermath: the millions of barrels of waste fluids that are disposed of in wells thousands of feet below the ground. Last year, deep injection wells stored 11 million barrels of the fluids in Ohio.

 

The 11 Youngstown earthquakes since March have shined a spotlight on the 177 deep well injection sites in Ohio, which records show are now accepting more oilfield fluid waste than ever -- nearly 37,000 barrels a day.

Read more at: http://www.cleveland.com/open/index.ssf/2012/01/earthquake_raises_issues_on_oi.html

Location of Ohio’s new shale fracking wells--powered by Google maps

http://www.plunderbund.com/2012/01/16/location-of-ohios-new-shale-fracking-wells/

Location of Ohio’s new shale fracking wells--powered by Google maps

http://www.plunderbund.com/2012/01/16/location-of-ohios-new-shale-fracking-wells/

 

Cool! Thanks!