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.”
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.
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.