^ The Columbus Dispatch had a follow-up story about how oil and gas taxes vary from state to state.  They had an interesting chart that showed oil & gas taxes collected as a percentage of total state taxes collected.  The top three states with the highest percentages were Alaska at 74.3% of oil & gas taxes as a share of overall state taxes; North Dakota at 43.0%; and Wyoming at 34.1%.

 

For Ohio and the five adjacent states - West Virginia was highest with 9.0%; Ohio was fourth with 0.04%; Indiana fifth with 0.01%.  Pennsylvania was last with 0% because they don't have any "severance" taxes on oil and gas drilling.

 

Below is the link to the article from the Dispatch.

 

Oil, gas taxes vary widely by state - Kasich, foes of his plan will find state variances

A billion here and a billion there and soon we're talking like it's no big deal anymore. But it is....

 

$2.5 Billion Deal to Bring More Investment in Utica

Monday, March 19, 2012

 

YOUNGSTOWN, Ohio – A $2.5 billion acquisition announced late today is poised to bring another huge investment to develop midstream infrastructure in the rich liquid gas fields of eastern Ohio’s Utica Shale.

 

Williams Partners, based in Tulsa, Okla., will pay $2.5 billion to acquire Caiman Energy’s wholly owned subsidiary, Caiman Eastern Midstream LLC.

 

In announcing the acquisition, Williams Partners said it intends to participate in a new joint venture with Caiman Energy to develop midstream infrastructure in the natural gas liquids areas of the Utia shale in Ohio and northwest Pennsylvania.

 

READ MORE AT:

http://businessjournaldaily.com/drilling-down/25-billion-deal-bring-more-investment-utica-2012-3-19

$4,000 an acre....WOW! Lots of other good info in this article.....

 

Columbiana Port Authority Signs with Chesapeake

Tuesday, March 20, 2012

By Jeremy Lydic

 

EAST LIVERPOOL, Ohio -- Chesapeake Energy Corp. extended its reach in Columbiana County by signing a five-year lease for the drilling rights for 156 acres owned by the Columbiana County Port Authority.

 

Chesapeake will pay the port authority $4,000 per acre with a royalty of 17.5% of net revenues it generates from either oil or gas produced and marketed. The Oklahoma City-based Chesapeake will have the option to extend the lease before or on the expiration date for an additional five years.

 

The board of the port authority approved the lease at its monthly board meeting Monday evening.

 

READ MORE AT:

http://businessjournaldaily.com/drilling-down/columbiana-port-authority-signs-chesapeake-2012-3-20

I'd predict those royalty checks will dwarf the land acquisition costs.

Second shot at cracker is coming

W.Va., Ohio, Pa. will vie once again for jobs

March 19, 2012

By CASEY JUNKINS - For The Weirton Daily Times , Weirton Daily Times

 

WHEELING - Though Royal Dutch Shell signed a deal to take its ethane cracker to Pennsylvania, a West Virginia-based company is still looking to help create thousands of jobs by building a similar plant in the next few years.

 

...."Shell's announcement proves that projects like this are viable here," said Leonard Dolhert, chief executive officer of South Charleston, W.Va.-based Aither Chemicals. "We are in the game."

 

Dolhert's company plans to locate a slightly smaller version of Shell's cracker somewhere in the Mountain State, Ohio or Pennsylvania within the next four years.

 

Company information states Aither is a petrochemical firm whose technology will use a patent-pending catalytic cracking method to transform the ethane into ethylene, which is the basis for plastic production.

 

READ MORE AT:

http://www.weirtondailytimes.com/page/content.detail/id/579399/Second-shot-at-cracker-is-coming.html?nav=5006

I got a chance to see some of the drilling sites up close. They are not your typical "mom and pop" natural gas drilling sites, but sites with a small tower and a pad that is clear for the equipment necessary. I'd guess about 10-15 acres disturbed, with an access road. Exciting times for that region...

I got a chance to see some of the drilling sites up close. They are not your typical "mom and pop" natural gas drilling sites, but sites with a small tower and a pad that is clear for the equipment necessary. I'd guess about 10-15 acres disturbed, with an access road. Exciting times for that region...

 

I'm doing some work for the Western Reserve Port Authority, recommending some small-scale rail projects for them. So that means gathering information on all the new and pending nat-gas and other projects that could generate new rail traffic. The information coming in from railroads, shippers, commercial realtors, chambers and others is mind blowing. This region is going to be totally different in the next 3-6 years, and the rail traffic growth is going to be more long-term  than in the Marcellus region because the gas is dry and can be moved by pipeline. Utica's gas is wet and its separated products have to be moved by vehicles. Considering the volumes involved, this means a lot of rail activity. It also means you may see long-abandoned rail lines reactivated like what is already happening in Pennsylvania but on a potentially larger scale. In fact, a former W&LE rail line south of Cadiz is already being reactivated to serve an industrial park where a $900 million nat-gas processing plant will be built.

More more more....

 

Valerus Studies Mahoning Valley for Potential Plant

Thursday, March 22, 2012

By Dan O'Brien

 

PITTSBURGH --Valerus, a mid-market gas-services company based in Houston, is the latest company related to the oil and gas industry to report it's looking for a site in the Mahoning Valley from where it hopes to capitalize on Utica shale exploration.

 

“We see particularly Youngstown and eastern Ohio becoming a major manufacturing hub for the Utica and Marcellus," Peter Lane, president and CEO of Valerus, tells The Business Journal. “We've done several exploratory missions -- especially to Youngstown.”

 

Lane, who attended Hart Energy's Marcellus Midstream Conference this week in Pittsburgh, reports his company is considering the Mahoning Valley to locate of a manufacturing plant that could employ from 50 to 100 people. Valerus manufactures compression equipment, provides engineering services, power generation components and compression services for the industry.

 

READ MORE AT:

http://businessjournaldaily.com/drilling-down/valerus-studies-mahoning-valley-potential-plant-2012-3-22

Concerns expressed here at UO about locals getting jobs are being shared elsewhere too......

 

Companies, Unions Want Shale Industry Opportunities

Friday, March 23, 2012

By Joe Giesy

 

CANFIELD, Ohio -- Companies and labor unions that don’t want to be left out of the oil and gas business resulting from exploration in the Utica shale met Thursday to make sure they are included.

 

Local 396 of the Plumbers and Pipefitters union hosted an “energy networking forum” at the Mahoning County Career and Technical Center to strengthen their ties and discuss what they can provide one another.

 

The networking breakfast was not meant for vendors to pitch their products or services, but rather for businesses and labor leaders to meet and discuss what they need to share in the success the shale play will bring, Butch Taylor, business manager of the Local 396, said afterward.

 

READ MORE AT:

http://businessjournaldaily.com/drilling-down/companies-unions-want-shale-industry-opportunities-2012-3-23

It's "enriching" to be a Trumbull County property owner today....

 

BP Cautions Entry into Trumbull 'Very Early'

Tuesday, March 27, 2012

 

YOUNGSTOWN, Ohio -- The enormity of the number of acres – 84,000 -- and the prevalence of wet gas and liquids in what geologists more precisely call the Point Pleasant formation of the Utica Shale is why BP North America is entering into a $331.5 million deal with the Associated Landowners of the Ohio Valley to lease shale gas drilling rights in Trumbull County.

 

“The liquids uplift actually makes this play look very, very favorable in relation to our portfolio,” says Tim Harrington, regional president of BP North America’s gas business.

 

The energy giant set up a conference call with Ohio reporters this morning, during which Harrington cautioned his company's entry into Trumbull County’s Utica shale fields is in its “very, very early" stages.

 

READ MORE AT:

http://businessjournaldaily.com/drilling-down/bp-cautions-entry-trumbull-very-early-2012-3-27

Regarding Kaisich's tax proposal, isn't that basically what Alaska does? And isn't that why when oil boomed the first time the residents were actually getting checks from the proceeds? I am basing this off of memory of the 2008 election, so I might be wrong. And believe me I know that there is no way Ohio residents could ever directly get checks based on our huge overall population and expenses vs Alaska.

It would be fair if the oil industry funded the budget of Ohio during this energy boom, because future generations of Ohioans are going to have to pay the cost of reconstructing what the oil companies damage. 

 

Now this http://www.dispatch.com/content/stories/local/2012/03/27/bill-allows-some-hiding-of-fracking-chemicals.html

Worth reading. Here's a graphic of a frac well, which drills down 6,000 feet to the Utica shale thousands of feet below groundwater. The volume of gas to come out of the well site requires a 6-inch pipe, the same width of the nat gas pipe along Highland Avenue in Warren, Ohio that fuels the entire City of Warren. Thus one well site can fuel an entire city of 50,000 people for decades....

 

 

Shale Industry Not Making Its PR Case, Exec Warns

Wednesday, March 28, 2012

By Dan O'Brien

 

PITTSBURGH -- The oil and gas industry's response to opponents of hydraulic fracturing was slow in coming, allowing for resistance to build not only in the United States, but in other countries as well, says an energy executive.

 

"The industry, I'll admit it, has done a bad job of PR and marketing," said Chris Faulkner, CEO of Breitling Oil and Gas, Irving, Texas, during the International Quality and Productivity Center's Marcellus Shale Gas Drilling and Completions Summit Tuesday. "We underestimated the power of public opinion, and that's causing concern in the long-term."

 

Faulkner said he recently visited South Africa, where opposition to the practice is more pronounced than it is in the United States. "A lot of folks there are heated about it, and a lot of their knowledge comes from the U.S.," he said. "Some of it is skewed, misinterpreted and flat-out wrong, but they are taking that now and applying it to international markets."

 

READ MORE AT:

http://businessjournaldaily.com/drilling-down/shale-industry-not-making-its-pr-case-exec-warns-2012-3-28

The Vindicator is running a series on this. I support increased regulation on drillers but not a moratorium as the benefits outweigh the negatives. We don't stop driving because there are sometimes unsafe cars and unsafe drivers, even though 40,000 people die in car accidents each year. We learn from each incident and then take appropriate measures to guard against repeat incidents in the future. The benefits are far too great for a moratorium, but not too much for regulation....

 

RISKS AND RICHES IN THE FRACKING ERA

Published: Sun, April 1, 2012 @ 12:00 a.m.

Hydraulic fracking is sweeping through our region, leaving in its path new jobs, new prospects, new hope — and much concern it is expanding too fast.

 

Watch for THE NEXT INSTALLMENT OF the series THIS WEDNESDAY.

 

By jeanne starmack

[email protected]

 

LAWRENCE COUNTY, PA.

 

Great changes have been predicted for the local economies, and the jobs promise from a new, booming industry is seductive. That prediction and promise came true for Washington County, which Range has heavily developed, says Larry Maggi, chairman of the county’s board of commissioners.

 

“We had more millionaires per capita last year than any other county in the nation,” Maggi said.

 

He said there were so many truck-driving jobs being created that a new school was built to train drivers. Restaurants and retailers have been busy — and hiring.

 

The growth has attracted new industries. “National industries are coming here because it’s close to cheap energy,” he said.

 

As fracking has grown, so too have the questions about how safe it is for the environment and public health.

 

READ MORE AT:

http://www.vindy.com/news/2012/apr/01/risks-and-riches-in-the-fracking-era/

New map of where the dry gas, wet gas and oil areas are located:

 

 

With shale, there’s lots at ‘play’

Ohio geologists continue to redraw the maps highlighting where the Utica shale is expected to yield the most oil and gas across the state.

 

The newest map by the Ohio Geological Survey excludes some areas that had been in “play” and includes others that had been left out of the “fracking” boom.

 

At stake is the potential for landowners to cash in on oil and gas drilling. Energy companies are offering bonuses that exceed $5,000 an acre in some areas.

 

There’s Utica shale beneath most of Ohio, but for drilling companies it’s all about the “play,” the core area where the shale is deemed most likely to yield a lot of natural gas, propane, butane, ethane and oil.

 

The newest map from the Ohio Geological Survey shows a potential oil reservoir in portions of Delaware, Marion and Union counties.

 

In southeastern Ohio, Athens, Meigs and portions of Morgan and Washington counties are no longer in the play. Most of Cuyahoga, Lake and Lorain counties in northeastern Ohio also now are excluded.

I suspect this could be a boom for Cleveland and its surrounding communities, as well.

The Vindicator is running a series on this. I support increased regulation on drillers but not a moratorium as the benefits outweigh the negatives. We don't stop driving because there are sometimes unsafe cars and unsafe drivers, even though 40,000 people die in car accidents each year. We learn from each incident and then take appropriate measures to guard against repeat incidents in the future. The benefits are far too great for a moratorium, but not too much for regulation....

Drilling should not start until we are assured that the operations don't introduce chemicals into the environment that kill pets and livestock. 

 

http://www.bloomberg.com/news/2012-02-08/fracking-s-toll-on-pets-livestock-chills-pennsylvania-farmers-commentary.html

 

Fracking’s Toll on Pets, Livestock Chills Farmers

 

A new study by veterinarian Michelle Bamberger and Robert Oswald, a professor of veterinary medicine at Cornell University, chronicles case studies of dozens of farmers and pet owners in six states over the Marcellus Shale.

 

Their findings, published in “New Solutions: A Journal of Environmental and Occupational Health Policy,” are a harrowing account of sudden deaths of cattle, as well as reproductive and neurological problems in horses, cats, dogs and other animals.

 

The Pennsylvania farmers I spoke with have lost cows, calves, a horse, a couple dozen chickens. Many of the animals succumb in the same way: seizure-like symptoms, gasping for breath and a quick wasting away. A Rottweiler and a Dalmatian also fell ill and died.

Drilling has started. I'll bet more livestock, wildlife and pets are killed by cars than by drilling. Probably far more. So why not first put a moratorium on driving?

^that's silly.  Just because A has negative effects is no reason that we should rush ahead with B before considering the impacts.

^^probably not the best analogy to use KJP, but really the point is that even in that article it seems that problems that the farmers were having were incidental and not systematically linked to the drilling. If they are incidental incidents, such as failure to follow procedure or dumping waste water illegally, the way to handle is through enforcement of regulations with stiff penalties and increased oversight.

 

Anybody care to discuss the political side of this? This is the part that I find fascinating and is hardly being discussed. This could completely change the geo-political power landscape if the US can ramp up to utilize the natural gas reserves (ie freight trucking, etc) and continue to utilize wind and solar. I went looking online for some articles or academic papers on it, but even the stuff I found from 2010 is horribly outdated given the scope of what they say the utica shale can produce.

 

Edit:

 

One interesting article following CERA

 

http://www.cnbc.com/id/46606934/How_Natural_Gas_Is_Changing_Global_Energy_Market

 

From the article:

"Industry practices are much more uniform than people think," Hersh said. "I think the fracking issue will end up being resolved in more oversight and more reporting, which will just add a layer of cost. It's too important an industry...and it has too many jobs associated with too much economic benefit, that it won't be killed."

^that's silly.  Just because A has negative effects is no reason that we should rush ahead with B before considering the impacts.

 

Why is a consistent approach silly?

 

CBC, why ruin a good conversation with politics? :) And didn't you mean to say you wanted to use natural gas as feedstock for diesel fuel for locomotives??

You're right, moratoriums on anything not totally safe!  We should put a moratorium on staircases!  Playing sports!  Eating fatty food!  Having sex!

 

Or maybe we could put moratoriums on things that we can practically put moratoriums on in order to slow down and develop best practices.

^^No I didn't say politics, I said political side :) Believe it or not there is a difference....

 

^X, actually the low, low gas prices are in effect putting a moratorium on drilling new wells. Most of the drilling so far has been exploratory, with actual production being secondary. The gas companies are buying  a lot of drilling rights to lock up supply, but current prices can't support drilling many production wells. The feeding frenzy has been in property lease and drilling rights. Also the procedures and processes have come a long way of the early hydralic fracking and natgas drilling in Wyoming in the early 2000's.

X, My point is that there have been cars that were built in an unsafe manner (Corvair, Ford Pinto, Suzuki Samarai), and there are cars operated in unsafe manner. But most cars are safe and indeed offer many benefits that aren't worth sacrificing to a moratorium despite the 40,000 Americans killed in car accidents each year.

 

Shale drilling is also safe when casings are drilled properly and workers conduct safe practices. In fact no horizontal drill casing has EVER leaked into the groundwater. The only time drilling fluids have gotten into the groundwater is when there have been surface spills and blowouts at the wellhead. So why should the relatively few instances of violations and problems force a moratorium on the rest of an industry that is conducting itself responsibly while providing immense benefits to local, regional and national economies?

 

That is why the analogy makes sense. I can see why it doesn't make sense to someone who falsely believes the hype that responsible drilling is not safe. But the more you learn about the industry, the more you realize how amazing this will be for Northeast Ohio and for America.

 

^^No I didn't say politics, I said political side :) Believe it or not there is a difference....

 

^X, actually the low, low gas price are in effect putting a moratorium on drilling new wells. Most of the drilling so far has been exploratory, with actual production being secondary. The gas companies are buying  a lot of drilling rights to lock up supply, but current prices can't support drilling many production wells. The feeding frenzy has been in property lease and drilling rights.

 

Describe the political issues. Do you mean regulatory issues?

 

Development of the Marcellus is being slowed by low nat-gas prices, but that is also attracting industry to the region and will also likely cause some coal-fired power plants to switch over to nat-gas. That's an undeniable environmental benefit from shale gas. Meanwhile the Utica shale development is going full speed ahead as its wet gas is much more profitable than the Marcellus' dry gas because it contains all the other sub-components that are also requiring the billions of dollars of investment in processing plants, crackers (another one is coming), plastics plants (hello Akron) and the reactivation of rail lines, some of which that have been dormant for 30 years. That's where I'm involved, and those rail infrastructure investments and low-cost energy supplies can create spin-off benefits for expanding industry in this region for decades to come.

BTW fracking (ie cracking rock to release gas) is not new, they used to be able to use explosives on vertical wells after the they drilled them. It's the hydraulic fracking required by the horizontal drilling that is new.

 

How Shale Changed Washington County, Pa.

Friday, April 06, 2012

By Dan O'Brien

 

Unemployment is nearly two points lower than the national average. Population didn’t fall during the last decade; it increased. Major national and international businesses have moved in, hiring mostly from the local labor market.

 

This description normally fits traditional bustling economic regions such as the South or West, where population and business demographics have shifted over the last decade.

 

Not in this case.

 

READ MORE AT:

http://businessjournaldaily.com/drilling-down/how-shale-changed-washington-county-pa-2012-4-6

On the economic policy side, I agree with KJP.  The economic benefits are too large and too clear for the industry to be killed, or even temporarily iced by a "moratorium" (which I think most lawmakers in the affected states realize are pushed by people who are more ideologically interested in killing all fossil fuel development than pragmatically interested in water and livestock safety, meaning that no amount of research would ever convince such people that such a "moratorium" should be lifted).  A more delicate political issue is whether the federal or states' governments (federal vs. states' EPAs, DNRs, etc.), will be the principal player establishing the regulatory environment for fracking and horizontal drilling.  The federal government has the ability to "occupy the field," in legal parlance, preempting all state regulation in a given field in the interests of national regulatory uniformity.  It doesn't use that power very often, though (otherwise, there would be no state EPAs, after all).  Still, because this is both a politically charged issue (and therefore might spark one party or the other's base at some point) and one on which incredible amounts of money in multiple states rests, there may be calls from each major national party's base at some point to either place a national moratorium on fracking/horizontal drilling (from the Democratic base) or to preempt any state attempts to establish varying regulations on the practice (from the Republican base).

 

As for the larger political implications of the development: I don't think this is going to change the world.  The energy developments that will really change the world are scalable, commercialized solar at grid parity and electrical energy storage at an energy density comparable to hydrocarbons.  However, while it won't change the world, it will have a significant positive economic impact on the region ... and given what this region has been through, that's reason enough to celebrate.

Overplayed, as in overdeveloped, over-supplied, etc......

 

Utica Shale Play: In Danger of Being Overplayed?

Monday, April 09, 2012

By Dan O'Brien

 

PITTSBURGH -- The trillions of cubic feet of natural gas liquids trapped in the Marcellus and Utica shale are of little value – and the jobs created through exploration here, temporary at best – if these resources are not developed through systematic planning, cooperation, and communication, cautions a top energy executive.

 

“If we kill the NGL [natural gas liquids] market with oversupply or overdelivery, then we’re just going to simply lower our rates of return,” says Rodney Waller, senior vice president of Fort Worth-based Range Resources Corp. “When you lower the rates of return, then all of the jobs we just created are going to evaporate.”

 

Key to avoiding this is developing the wet-gas market in the Utica shale so it will meet – and not exceed – demand, much as Range Resources did in the liquids window of the Marcellus in southwestern Pennsylvania, Waller told participants at Hart Energy’s Marcellus Midstream Conference March 20.

 

READ MORE AT:

http://businessjournaldaily.com/drilling-down/utica-shale-play-danger-being-overplayed-2012-4-9

The USGS notes that hydraulic fracturing (fracking) and horizontal drilling does not cause earthquakes. Rather the rare (and no longer recommended) disposal of frack wastewater into deep injection wells after the drilling is done is what has caused the earthquakes. The more common post-drilling use is to treat the wastewater. Unfortunately, too many in the media or in public don't know the difference (including the writer of this headline even though the article reports differently)....

 

U.S. Geological Survey Links Man-Made Earthquakes to Gas Drilling

April 4, 2012 | 4:24 PM

By Susan Phillips

 

    Under­ground injec­tion of frack waste water “almost cer­tainly” caused a wave of earth­quakes from Alabama to Col­orado, accord­ing to a new report soon to be issued by the U.S. Geo­log­i­cal Sur­vey. The researchers looked at a spike in unusual seis­mic activ­ity that began in 2001.

 

A remark­able increase in the rate of M 3 and greater earth­quakes is cur­rently in progress in the US mid­con­ti­nent. The aver­age num­ber of M >= 3 earthquakes/year increased start­ing in 2001, cul­mi­nat­ing in a six-fold increase over 20th cen­tury lev­els in 2001. Is this increase nat­ural or manmade?

 

(Read StateIm­pact Pennsylvania’s look at the wells’ tie to recent earth­quakes in east­ern Ohio.)

 

The report says the use of deep injec­tion wells to dis­pose of the waste water is the likely source of the increase in seis­mic activity.

 

READ MORE AT:

http://stateimpact.npr.org/pennsylvania/2012/04/04/u-s-geological-survey-links-man-made-earthquakes-to-gas-drilling/

The State of Ohio dedicates $2 million per year to freight rail development; the Commonwealth of Pennsylvania dedicates $30 million per year. Thus far, RESTORE has identified about $100 million in shale-rail freight needs in Ohio's Utica region. If we want to compete and realize the region's potential, we need to be investing closer to Pennsylvania's level of commitment....

 

U.S. Transportation Deputy Meets with Regional Chamber

Thursday, April 12, 2012

By George Nelson

 

YOUNGSTOWN, Ohio – The Obama Administration wants to do “as much as possible” to capitalize on the economic development opportunity represented by the natural gas industry in the region, a U.S. Department of Transportation official said.

 

“We very much think of transportation as an enabler for economic development,” said John D. Porcari, deputy transportation secretary. “It’s investing in our highway system. It’s making sure that the rail connections are here, making sure the transmission capacity in the pipeline network for natural gas is here. There is a great economic development opportunity and as part of the Obama Administration energy initiative we want to make sure that we capitalize on that and are doing as much as possible.”

 

Porcari met with members and staff of the Youngstown/Warren Regional Chamber at the chamber's offices downtown Wednesday for what was described as a "White House Roundtable."

 

READ MORE AT:

http://businessjournaldaily.com/economic-development/us-transportation-deputy-meets-regional-chamber-2012-4-12

Utica shale bringing jobs to Eastern Ohio: Liquids-rich shale stokes economic development

NEW YORK (MarketWatch) —The hardscrabble city of Youngstown, Ohio, hadn’t seen a major industrial expansion in decades.

 

That finally changed in 2010, when European conglomerate Vallourec SA said it would significantly scale up in the region with an investment of $650 million and 350 jobs for a new pipe-making plant for its V&M Star unit.

 

“It’s probably the largest steel plant in Youngstown since the 1920s,” said Tony Paglia of the Youngstown/Warren Regional Chamber.

 

At first, the V&M Star planned to supply pipe for horizontal drilling in the oil and gas fields of Marcellus shale, mostly across the state line in Pennsylvania.

 

Now, more job creation opportunity has emerged closer to home as energy companies develop one of the newest and hottest shale plays in the U.S. -- the Utica shale of Ohio. Much of the oil-rich region lies within a corner of the country that’s suffered from high unemployment for many years.

 

“V&M Star decided when they saw the Marcellus shale they needed to have a plant nearby that provided products [there],” Paglia said in a telephone interview. “Once they started that, then the Utica shale became prominent -- so that makes it an even better project.”

 

A spokesman for V&M Star referred to published remarks by President Joel Mastervich, who said the region is “extremely well-suited” to supply local shale plays and that the area offers high quality workers.

 

About 1,500 jobs have been added or announced in the last 18 months in the Mahoning Valley -- the region that includes Youngstown and the surrounding region.

 

[...]

Good article. The map showing the Utica sites is very helpful. And the aerial of the V&M plant is great. You don't appreciate how big it is unless you compare it to vehicles nearby.

Permits for drilling down going up

State busy as interest in shale deposits, their 'wet gas' at fever pitch

By DAN SHINGLER

4:30 am, April 16, 2012

 

The nice thing about the oil and gas business is that it announces both its presence and its future activity, thanks to a process that requires a state permit for all new wells.

 

Even nicer, for Ohio at least, is that permitting activity indicates a busy year ahead as drillers begin ramping up their request to sink horizontal fracking wells in the state's Utica shale region, while moving in new drilling rigs to act on approved permits.

 

It's all because drillers are flocking to the Utica shale and its so-called “wet gas,” which includes not just natural gas but also butane, ethane and other liquids valuable as ingredients in petrochemicals.

 

READ MORE AT:

http://www.crainscleveland.com/article/20120416/SUB1/304169993#

Drilling has started. I'll bet more livestock, wildlife and pets are killed by cars than by drilling. Probably far more. So why not first put a moratorium on driving?

I posted in this thread about how gas could be used more efficiently with generation through combined heat and power and by closed cycle generation.  We would be using the same resources at a slower rate which, everybody agrees, is better for this country.

 

But there is no follow up to my energy efficient proposals.  I see a hysterical rush to get to resources and deplete them.  In a few decades, we will be without *any* options, including efficient generation, because all the gas has been spent.

***

Now that the Ohio injection wells are off limits, are Pennsylvania drillers going to return to dumping saline water in the rivers?  That is what happens if they truck the drilling fluids to a municipal waste treatment plant.  The saline water is not removed.

It sounds like an admirable idea. If it is, and if enough people are passionate about it to keep pushing it, then it stands a chance of success. Good luck.

^^ Boreas, you are on the right track, I don't know if we will embrace the concept of it as a society but it does make sense. Municipal utilities and co-ops are in the best position to do it. They could probably  use electric fleet vehicles and sell heat, too, at least commercially.

 

The for profit utilities are hampered by market rules designed to keep competition fair that prohibits sharing of information. I know from my experience in the Electric utilities they used to call the pre- deregulated optimization of the whole power system, Integrated Planning, which was planning the system from Generation to Transmission lines to  Distribution in homes and businesses. That term is a big no-no now. It's market principles driven at least in Ohio now. When every portion of the process operates independently it makes it hard to optimize the whole process.

Interesting that the Salem News article says the rail line will also be operated by Tervita, but the Journal article below says nothing about it:

http://www.salemnews.net/page/content.detail/id/553392/Port-finds-buyer-for-old-Y-S-railroad.html?nav=5007

 

 

Canadian Energy Services Company Buys Y&S Rail Line

Tuesday, April 17, 2012

By Dennis LaRue

 

EAST LIVERPOOL, Ohio – By July 16, the former Youngstown & Southern Railroad will have a new owner, Tervita Corp., based in Calgary, Canada.

 

On its website, Tervita describes itself as “an environmental and energy services company.” It will pay $2.9 million in cash to the Columbiana County Port Authority for the 36-mile line that runs from Youngstown to Darlington, Pa., the CEO of the authority, Tracy Drake, reported Monday night.

 

Tervita, a privately held company, signed a letter of intent April 5 when its director of business development, Enrique Proano, put down $150,000 in earnest money. That $150,000 is part of the purchase price of $2.9 million.

 

READ MORE AT:

http://businessjournaldaily.com/economic-development/canadian-energy-services-company-buys-ys-rail-line-2012-4-17

Chesapeake CEO took out $1.1 billion in unreported loans

 

HOUSTON (Reuters) - Aubrey McClendon, the CEO of Chesapeake Energy Corp, has borrowed as much as $1.1 billion over the last three years against his stake in thousands of company wells - a move that analysts, academics and attorneys who reviewed loan documents say raises the potential for conflicts of interest.

The loans, which haven't been previously detailed to shareholders, are used to fund McClendon's operating costs for an unusual corporate perk that offers him a chance to invest in a 2.5 percent interest in every well the company drills. McClendon in turn is using the 2.5 percent stakes as collateral on those same loans, documents filed in five states show.

 

The size and nature of the loans raise questions about whether McClendon's personal financial deals could compromise his fiduciary duty to Chesapeake investors, experts who reviewed the documents told Reuters.

Both McClendon and Chesapeake said the loans don't pose any conflict of interest. And they are private transactions that the company has no responsibility to disclose or to vet, Chesapeake said. "There are no covenants or obligations in my loan documents or mortgages that bind Chesapeake in any way," McClendon wrote in an email to Reuters.

...

http://finance.yahoo.com/news/exclusive-chesapeake-ceo-took-1-1-billion-unreported-104659198--finance.html

With this "oops" by the CEO, now is a great time to buy Chesapeake stocks....

 

http://www.dailyfinance.com/2012/04/17/ignore-chesapeake-energy-at-your-own-peril/

 

http://www.reuters.com/finance/stocks/CHK/key-developments/article/2521355

Columbus Dispatch editorial advocates for a severance tax:

 

http://www.dispatch.com/content/stories/editorials/2012/04/20/bring-it-back.html

 

While Ohio lawmakers struggle to juggle a heaping legislative plate this spring, they’ve made at least one conspicuously bad call, in ignoring Gov. John Kasich’s proposal for a reasonable severance tax on the mineral wealth that’s about to be taken from the state in vast quantities.

 

They’re denying Ohioans a rightful share in the state’s natural-resources wealth and giving oil-and-gas drillers, who stand to reap fortunes from Ohio’s Utica shale formation, an unjustified free pass from a form of taxation that is standard in the industry and in states surrounding Ohio. ...continues...

---

Today, I am on John Kasich's side.  It was bound to happen some day.

Apparently our legislators believe any tax is a bad tax. Good "thinking" fellas.

There is probably a better source, but this is what popped up in my RSS feed and is why Kasich was in Canton today.

 

Ohio steel operation kicking off $225M expansion

April 23, 2012

 

CANTON, Ohio (AP) — Gov. John Kasich (KAY'-sihk) was on hand as the Timken Co. broke ground Monday near Canton for a $225 million expansion of its Faircrest steel plant.

 

The maker of specialty steel says a significant factor behind the expansion is current and expected demand by the oil and gas industry in eastern Ohio and elsewhere.

 

What's even more impressive is that its continuous caster will rise 180 feet above ground -- and 80 feet below ground! And this investment (like others) is more proof that major companies see the natgas boom as big and long-lasting....

 

Timken breaks ground on big expansion

By Katie Byard

Beacon Journal business writer

 

Published: April 23, 2012 - 01:30 PM | Updated: April 24, 2012 - 07:05 AM

 

PERRY TWP.: Timken Co. Chairman Ward J. “Tim” Timken Jr. recalled Monday that people thought the company was “a little bit nuts” to begin building the $450 million Faircrest steel plant in the early 1980s recession that gave the Rust Belt its name.

 

On Monday, 30 years later, the bearing and steel maker ceremoniously broke ground on a $225 million expansion to the Faircrest plant, south of Canton.

 

Timken’s steel business is thriving. The Canton company reported record overall sales in 2011 and is expecting higher sales and income for this year.

 

READ MORE AT:

http://www.ohio.com/news/break-news/timken-breaks-ground-on-big-expansion-1.302373

Weatherford Pays $3.4M for Performance Park Building

Monday, April 30, 2012

 

YOUNGSTOWN, Ohio -- Another global oil and gas company is moving into the Mahoning Valley with the closing of a $3.4 million transaction to set up shop in the city's Performance Place Industrial Park.

 

An affiliate of Weatherford International, based in Geneva, Switzerland, has purchased the former acquired the former Polyair facility. The 153,708-square foot building sits on 20 acres; its $3.4 million sale price amounts to about $22 per square foot, public records show.

 

Weatherford Artificial Lift Systems, based in Houston, purchased the property from an affiliate of Stag Industrial Inc. in Boston, which had listed the property for $3.84 million with CRESCO Real Estate, an affiliate of Cushman & Wakefield in Cleveland. Stag Industrial had acquired the property in 2007 for $3.9 million.

 

READ MORE AT:

http://businessjournaldaily.com/drilling-down/weatherford-pays-34m-performance-park-building-2012-4-30

I really wonder what the economic legacy of all this drilling and extraction will be for NEO.

Some optional answers:

 

> Go to Youngstown and ask the manufacturers, suppliers, transportation companies, realtors and others involved.

> You can only live life one day at a time, so why try to predict the unpredictable future?

> Get a customized DeLorean if you really want to know what the future holds.

^LOL, simple answer is curiousity. I wonder if this will be the economic boon this area has needed for 40 years, will it provide unintended environmental problems, will it encourage immigrants and others following the wealth and jobs created to this area, will it have no net effect on the status quo. Just curious as this is obviously huge.

^LOL, simple answer is curiousity. I wonder if this will be the economic boon this area has needed for 40 years, will it provide unintended environmental problems, will it encourage immigrants and others following the wealth and jobs created to this area, will it have no net effect on the status quo. Just curious as this is obviously huge.

 

I don't know the answer yet because my customized DeLorean was borrowed by my friend Biff who likes to gamble on sports, but I suspect the answer is in the affirmative, in varying degrees, for the first three scenarios. Those who wished we could shift right into renewable energy are very concerned about the environmental issues, which I agree are real WHEN the drillers don't build the casings as they are supposed to be designed or don't heed other safe drilling practices and end up causing spills or blowouts that contaminate water supplies.

 

But I've also spent a lot of time in the Mahoning Valley in the last few years to work on rail projects. Not only has my work increased, but I've seen just about everyone else's business increase. And much of the stuff they're working on in preparation for many more and larger construction projects -- and nearly all of it is oil and gas related. There are lots of little things I notice as someone who doesn't live in the valley but visits every few weeks to notice the changes in increments. Things like the traffic getting heavier on the roads, be it on I680 or Market Street in Warren. More trucks carrying supplies for wells and gas processing plants. More people on the streets in downtown Youngstown or Girard or Niles. Or more shops and restaurants open. Etc.

 

Or on the rails... Check out the thread "Booming growth on freight RRs" -- look at the pictures and where they were taken. There are rail lines that have been abandoned for 20-40 years that are being reactivated or considered for reactivation. Things a sober person would never have suggested even a couple of years ago.

 

And consider the "reshoring" of jobs (especially manufacturers). Unions are willing to negotiate on wages and work rules to keep jobs. And many employers may choose to go places with low energy costs, and natgas is dirt cheap as long as the drilling is allowed to continue.

Can't speak for the future, but in the present it's already having a lot of positive effect in Youngstown, Canton, and points between.  And just think, none of these new plants or plant expansions are on line yet.  Once they are there will be even more money getting pumped into local economies.

How timely!! ;) This is a must-read article, as it provides a small snapshot of all that is happening.....

 

Suitors dig real estate in booming shale area

Drilling revives industrial, office sites that have languished

By STAN BULLARD

4:30 am, May 1, 2012

 

Tiny Toronto, Ohio, population 5,200, calls itself the Gem City and prides itself on being Jefferson County's second-largest town, after Steubenville. It also may be the next poster child for the effect the rush of energy companies to explore the Utica shale region is starting to have on commercial real estate in long-languid eastern Ohio.

 

“The oil and gas boom has put us back on the map,” Toronto Mayor John Geddis said.

 

The site of a demolished Chevrolet dealership just got snapped up by an oil field supplier. But the big talk in town concerns the former power plant that FirstEnergy Corp. spent millions demolishing and remediating of environmental problems so the 60-acre site could go back into use.

 

READ MORE AT:

http://www.crainscleveland.com/apps/pbcs.dll/article?AID=/20120501/FREE/305019998/1225/newsletter04

The landowner has not signed any right of way agreement, but the oil company is going to force their way onto his land for a survey.

 

Pipeline injunction is filed

May 5, 2012

By MARK LAW - Staff writer (mlaw ... heraldstaronline.com) , The Herald-Star

 

STEUBENVILLE - A Houston pipeline company filed for an injunction Friday in Jefferson County Common Pleas Court to force a property owner to give the company access to the property to do survey work in preparation for the installation of a pipeline to transport liquid ethane across Ohio.

...

The company claims in its lawsuit that, as a pipeline company, it has eminent domain powers under Ohio law.

 

The lawsuit states the company has successfully sued five times in Ohio for survey access in Warren and Butler counties.

...

David Hyde (the landowner) said Friday that the farm was set up as an agricultural district. He said pipeline companies have to find alternate routes to cross agricultural districts.

 

Hyde said a proposed law pending in Ohio would strip farmers of those rights, adding the property ELP wants is in his best hay field.

 

He said ELP could use an existing pipeline corridor near the Unionport Cemetery, but the company claims it is too close to the cemetery. He said he also owns property on the existing pipeline corridor and gave permission for the company to use that property.

 

http://hsconnect.com/page/content.detail/id/573345/Pipeline-injunction-is-filed.html?nav=5010#.T6UI_cIZ5RM.facebook