Recent pipeline and processing infrastructure in the Marcellus area has increased not only natural gas production in Pennsylvania, but the job scene, as well.
As part of the Devonian black shale, the Marcellus shale play runs through northern Appalachia, primarily in Pennsylvania, West Virginia, New York, and Ohio and the core Marcellus potential is estimated to hold as much as 141 trillion cubic feet, according to studies performed by the Energy Information Administration. It is one of the richest gas fields in North America and the local economy is starting to feel the benefit.
Recent pipeline expansions have helped the Marcellus shale play reach a production rate above 7 billion cubic feet (BCF)/day; surpassing the Haynesville shale to become the largest gas producing play in the US, according to a recent IHS report.
Pennsylvania Department of Environmental Protection (DEP) estimates that the roughly 69% increase in production in the state from 2011 to 2012, despite a drop in the number of new natural gas wells, can be attributed, in part, to additional infrastructure that helped to bring drilled wells online.
One new facility serving both the infrastructure needs and the need for local jobs was recently announced in the state.
Marcellus GTL of Gilberton, Schuylkill County, plans to build a natural gas to liquids facility that it calls a Clean Energy Center, on 65 acres in Duncansville, PA in Blair and Allegheny Counties.
Construction of the $200-$250 million dollar facility, expected to begin in 2013, is expected to generate 200 jobs that will likely culminate in 25-30 primary jobs in the plant and 60 secondary jobs. The construction phase of the project is expected to take 22-24 months to complete.
The facility will have the capacity to deliver 2250 barrels/day of liquid fuel.
"This will be the first of its kind of facility in the country. These are the kind of jobs you can take a mortgage out on," said John Rich Jr., Marcellus GTL president and CEO, at a press conference with local officials following the announcement.
Because it has no wells of its own, the opportunity to create jobs from Marcellus shale operations is a boon to Blair County.
"Marcellus Shale is a godsend to the state of Pennsylvania. The discovery of Marcellus Shale is a great opportunity for us to revitalize the economy of Pennsylvania," said US Rep. Bill Shuster, R-9th District.
Economic impact is spreading
Service and supply companies are required for the various Marcellus operations, providing an additional expansion of the shale play’s economic benefit. Currently, Pennsylvania is home to a number of companies that manufacture well heads and other drilling parts.
Also in Blair County, in 2011, Wayne, PA-based Gardner Denver Inc., who recently agreed to a $3.9 billion buyout from global investment firm Kohlberg Kravis Roberts & Co. LP (KKR) announced its plan to build a 70,000-square-foot facility to manufacture pumps and for shale drillers.
The demand for steel pipe used in oil and gas drilling is also on the rise in the area, and steel makers benefit from both the lower cost of manufacturing and from strong demand.
Marcellus activity has been so strong, that the state’s Economic Growth Initiative recently earmarked a $2 million grant to the Central Pennsylvania Institute of Science and Technology in Pleasant Gap.
The growth of the Marcellus shale industry has boosted the demand for center’s diesel technology and transportation training.
Increasing classroom space at the facility is an investment in the state as it will put more people to work, Governor Corbett told a group of business owners, politicians, and county officials upon touring the facility in March.
Once completed, the facility will house a 35,000-square-foot training building, a 23,000-square-foot diesel yard and a 12,000-square-foot heavy equipment yard.
Thirty-one permanent jobs and 14 part-time jobs are expected at the facility, and Corbett estimated, 185 jobs will be created statewide with the additional trained workers coming out of the school.