MSC in Sun-Gazette: The natural gas formula: Safe development and solutions to attract, not drive away, investors

By David Spigelmyer

Pennsylvania is blessed with abundant natural resources. For more than 200 years, our coal, timber, oil, and natural gas have been the raw materials that have built our nation.

As we recognize Manufacturing Day and Energy Month, it’s a good opportunity to explore the ways homegrown, domestic natural gas is presenting a generational opportunity to unleash an American manufacturing rebirth.

That rebirth of good-paying, middle-class manufacturing jobs starts at the wellhead. Over the past decade, Pennsylvania, with its abundant shale resources, has emerged as the nation’s second largest natural gas producing state. In fact, if the Appalachian Basin – Pennsylvania, Ohio, and West Virginia – were a country, it would be the world’s third largest natural gas producer.

Alongside the safe, continued development of clean, burning natural gas has come good-paying jobs, new tax revenues, and significantly improved air quality. According to a recent PricewaterhouseCoopers study, natural gas development supports more than 320,000 jobs and contributes $45 billion to the Commonwealth’s economy. The study found that for every job generated in the oil and gas industry an additional 2.7 jobs were produced throughout the U.S. economy.

Why limit our energy opportunity when that resource has the potential to unlock a Made in the U.S.A. revolution?

Natural gas and natural gas liquids are the primary feedstocks to many manufacturing and petrochemical facilities, including the development of plastics. These operations rely on an affordable, reliable natural gas source, giving Pennsylvania a natural energy advantage to attracting new manufacturers.

We are nearly a decade into America’s shale energy revolution, however, we’re just in the early stages of realizing the downstream manufacturing opportunities tied to natural gas.

Earlier this month, Chevron and Peoples Natural Gas launched the ‘Forge the Future’ initiative with an economic analysis from McKinsey & Company that examines these downstream opportunities. The report projects Pennsylvania could see a $60 billion increase in gross domestic product over the next decade and over 100,000 more jobs, the majority of which would fall in the manufacturing sector if the Commonwealth fully embraces its energy opportunity.

As the Pennsylvania Manufacturing Association’s Dave Taylor said late last year, “we have a unique, generational opportunity to move the Commonwealth and our nation forward by leveraging our energy resources into much-needed job creation.”

In fact, the ethane cracker plant in Beaver County is a perfect example of Pennsylvania’s manufacturing future. Construction has begun on the plant that will take natural gas liquids in the form of ethane and produce the plastic used in nearly every consumer product. With 6,000 jobs supported during construction and another 600 when the plant is operational, this facility is just the first of what could be many more new plastics and petrochemical manufacturing facilities throughout the Commonwealth.

To fully realize our manufacturing opportunity ahead, we need the right mix of production, infrastructure and policies that will drive job-creating investment and economic growth.

An IHS Markit report, commissioned by the Wolf administration, released earlier this year concluded that Pennsylvania’s strong natural gas liquids production could attract four more ethane crackers to the region, totaling up to $3.7 billion in added investment. The researchers also concluded that the Commonwealth “must begin taking immediate steps to support a long-term strategy that will maximize in-state economic development” in order to remain competitive.

We are excited that Pennsylvania’s natural resources are once again presenting an opportunity for long-term sustained economic growth.

With our operators committed to safely developing and moving our natural gas resources to market, policymakers, too, need to recognize this opportunity and look toward pro-growth solutions to attract investment, not drive it away.

Click HERE to read this column online.