Upstream PA 2015 Packs a Punch at Penn State

Today’s blog is a repost courtesy of Adam Larson, Staff Writer, with Shale Media Group. You can follow both Adam and Shale Media Group on Twitter.
———

“We all have skin in the game,” said David Spigelmyer, President, Marcellus Shale Coalition (MSC), at the April 16th Upstream PA 2015, referring to Pennsylvania natural gas production and consumption. Upstream PA 2015 was held at the Penn Stater Conference Center in State College, PA and hosted by Shale Directories, the leading online directory that connects the oil and gas industry with local businesses in the major shale plays throughout the U.S.

Concentrating on the Marcellus Shale in Pennsylvania, the event started at 8am and ran until 2pm, in which guest speakers made appearances, networking breaks offered insight, and lunch was served. Emceed by Joe Barone, President, Shale Directories, the guest speakers of the day included: David Spigelmyer; George Stark, Director of External Affairs, Cabot Oil & Gas Corporation; Matt Henderson, Public Relations Manager, Inflection Energy; Rick Stouffer, Senior Energy Editor, Shale Energy Business Briefing; Robert Johnson, President, ADKL; John Felmy, Chief Economist, American Petroleum Institute (API); Jim Rodgers, Marketing & Business Development Director, Dawood Engineering; Jim Cheunes, Market Manager, Best Line, Equipment; and Dave Pfleegor, President, Rigmaids.

Key topics and discussion thrown around included shale oil and gas education, Marcellus Shale technologies and innovations, the Atlantic Sunrise Pipeline, natural gas power generation, and PA’s severance tax and impact fee. Driving the message home, Spigelmyer relayed, “To turn your lights on 365 days a year, 24 hours a day, you need gas, coal, and nuclear power to provide baseload fuel supply.”

“Fossil fuels does not only involve power generation, but also includes: steel, glass, plastics, chemicals, fertilizers, powdered metals, and pharmaceuticals,” continued Spigelmyer. This is exactly what Spigelmyer means by everyone having “skin in the game.”

Considering America’s unquenchable appetite for energy, the panel of speakers outscored the need for pipelines. It is simple – to get the gas to market, you need pipeline infrastructure. As Henderson put it, “Let’s take this oversupply of natural gas and take it to the market where there’s high demand.”

During Stouffer’s presentation, he provided some statistics from Bentek Energy’s Northeast Expansions Report. According to the Report, pipeline capacity expansions are coming online at a jaw-dropping pace. Between 2010 and 2013, there were 36 pipeline projects brought online in the Northeast totaling 8.94 Bcf/d in capacity. Between 2014 and 2017, there are 52 pipeline projects – new-build and expansions – east of the Mississippi River slated to come online, totaling 35.82 Bcf/d in capacity.
One company leading the pipeline charge is Williams, a midstream company based in Tulsa, Oklahoma. Working side-by-side with upstream companies, the company is expecting to bring the Atlantic Sunrise Project into service in the future. The project is designed to supply enough natural gas to meet the daily needs of more than seven million American homes by connecting producing regions in northeastern Pennsylvania to markets in the Mid-Atlantic and southeastern states. The expansion will add 1.7 million dekatherms per day of pipeline capacity to the Transco system.

Also, Williams has partnered with Cabot Oil & Gas, Piedmont Natural Gas, and WGL Holdings to develop a major transmission pipeline project to connect abundant Appalachian natural gas supplies in northern Pennsylvania with major northeastern markets. The approximate 124-mile Constitution Pipeline has been designed with a capacity to transport 650,000 dekatherms of natural gas per day, which is enough natural gas to serve approximately three million homes.

“Pipelines benefit everyone. New England needs pipeline infrastructure – they’re at the end of the straw and there’s not enough gas at the end of that straw for them,” said Stark. “It’s crucial to get the Constitution Pipeline up north from Susquehanna, Pennsylvania, where Cabot is producing about 2 Bcf/d there.” The gluttony of natural gas production in the Marcellus is a problem and pipeline networks need to be developed and fed with product.

Robert Johnson, the experienced President of lobbying firm ADKL, noted, “The natural gas industry is fighting back against outside groups who are protesting drilling and pipeline construction in Pennsylvania. We must be the advocates for this industry across the Commonwealth.”

The “skin in the game” is even at the pipeline stage right now. Tapping into the highway of cheap natural gas is local restaurants and schools. Stark brought up an intriguing discussion point. A restaurant in Lancaster County, Shady Maple, is reaping the benefits of Pennsylvania pipelines, as there was a pipeline extending through the restaurant’s backyard and the owner decided to gain access. Stark conveyed, “He’s now saving $125,000 per year on his energy bill.”

Even a school district within Lancaster County decided to tap into the same pipeline network, linking up with Shady Maple’s newly created grid. “Likewise, they are saving a significant amount of money on their energy bills,” said Stark. These are taxpayer dollars being saved.

Speaking of taxes, PA Governor Wolf’s proposed severance tax led conversation. Even with impact fees, Marcellus Shale companies have funneled channels of funds into local and statewide construction projects for some time now, which include improving roads. The speakers agreed that it is not the time to overtax this industry and pressurize a situation that already involves layoffs. Squashing the talk of a severance tax is the best solution, as Ohio has already done it, stating that a drastic taxation would drive up energy costs and threaten statewide shale oil and gas jobs.

To remain a contender in the industry, Pennsylvania jobs must be fueled by the younger populace. “Students are stepping into the oil and gas industry, whether it’s pipelines or compressor stations,” expressed Stark. “We’re looking at the ‘great crew change.’ There’s a great opportunity for the young workforce to get into this field both out of high school and college. Whether it’s running the drill rig, being a welder, or measuring the gas as it’s coming out of the ground.”

The generational tide is coming in quickly. Just as Stark pointed out, educational opportunities are vast. More and more high school programs are equipping their students with the tools to make informed decisions when directly entering the oil and gas field. At the crux of the Upstream PA conference, Penn State University is home to one of the top petroleum engineering programs in the country, as it is in fact the most rapidly growing major on the University Park campus.

In conjunction with the younger masses, technologies and innovations drive the future. “In 2010, we [Cabot Oil & Gas] started understanding our wells in northeastern Pennsylvania,” articulated Stark. “We then realized we had our hands on the tail of a tiger.” Just as George Mitchell, a wildcatter, revolutionized the industry back in the late 1990s and freed natural gas from shale, advancements are happening as we speak. Hydraulic fracturing lateral stages are getting shorter and more gas is flowing to surface via micro-fissures.

Shale Directories thanks their event sponsors, Energy Nation, Dawood Engineering, Rigmaids, Best Line Equipment, and Strata Worldwide. Shale Directories’ next endeavor will be hosting their summer safety seminar in St. Clairsville, Ohio on May 27th, 2015.

 

 

Severance Tax would be devastating to Wyoming County
Gov. Tom Wolf's severance tax proposal includes startling provision
Brittany Ramos

Brittany was born and raised in Pittsburgh, Pennsylvania and attended Pennsylvania State University where she earned degrees in Public Relations and Psychology. She recently earned her Masters in Sociology from Sam Houston State University. Brittany works in the External Affairs for Cabot where she manages communications and outreach projects to community members, elected officials, media and online supporters.

Leave a Reply