Driven By American Natural Gas, the Rust Belt Rebounds

The safe, responsible, tightly-regulated development of the Marcellus Shale’s abundant, clean-burning natural gas resources has “helped bring in jobs and boost demand for office space in [Pittsburgh], Pennsylvania’s second-biggest city.” That’s according to a Bloomberg News report today, which reports that Marcellus Shale development “is driving wage, job and population growth” across southwestern Pennsylvania.

Here are several highlights from the story:

  • Unconventional gas production alone is forecast to spur almost $3.2 trillion in new investment by 2035 and support more than 2.4 million jobs in the lower 48 U.S. states, according to an IHS Inc. study released in June. It projected a 14 percent annual compound-growth rate in Pennsylvania jobs tied to gas.
  • The Marcellus and Utica shale represent a transformative opportunity for the Pittsburgh region,” said Dennis Yablonsky, chief executive officer of the Allegheny Conference on Community Development.
  • By the end of March, jobs in the Pittsburgh region’s gas industry had almost quintupled to 437 from 93 in the first quarter of 2009, according to state Labor and Industry Department data. Within the seven-county metro area, employment had climbed 4.1 percent, or 46,000 jobs, in the past two years, Wells Fargo economists led by Jay Bryson said in a March report. … The San Francisco-based bank’s economists said that for every job created by drilling in one of the 14 Pennsylvania counties that host 90 percent of the state’s shale-gas wells, 2.5 more spring up in nonproducing counties.
  • It is a great, great opportunity and one that we look forward to taking advantage of in coming years,” Mayor Luke Ravenstahl said in an interview in City Hall. … Ravenstahl said balancing the industry and environmental concerns can be achieved. “We can protect the environment and drill in a responsible way, while also creating tens of thousands of jobs for local Pittsburgh residents,” he said.
  • The fracking boom has meant more work for the city’s professional services providers such as lawyers and engineers, boosting employment and demand for workspace, said Jeffrey Ackerman, managing director at CBRE Capital Markets. These include K&L Gates LLP and Reed Smith LLP, two law firms whose headquarters mark the downtown skyline. The amount of available top-quality office space has shrunk for 15 straight quarters. Oil and gas companies such as Shell, Chevron Corp. and Pittsburgh-based EQT Corp. have all rented more space as well. “The biggest driver is clearly energy and that’s coming from Marcellus shale,” Ackerman said. “It all feeds on itself.”

Separately, in a must read editorial yesterday, the Charleston Daily Mail – under the headline “Marcellus will soon be the biggest producer” – writes this: FOR the past four years or more, the national economy has struggled. The answer from Washington, D.C., is record deficit spending, which has not brought significant job gains. The answer from Washington, Pa., and thousands of other towns scattered across Appalachia is Marcellus shale gas, which is leading to royalties for landowners, cheap energy for consumers and jobs for the construction industry. A few facts:

  • In April 2011, Marcellus wells in Pennsylvania and West Virginia produced 3.6 billion cubic feet of gas a day.
  • By last month, that average had more than doubled to 7.4 billion cubic feet a day.
  • Marcellus shale now accounts for 25 percent of shale gas production in the nation.
  • Marcellus shale will soon surpass the Haynesville region in Arkansas and Texas as the No. 1 field.
  • The wholesale price of gas dropped to $3 per thousand cubic feet. In Japan and Europe, the price is $12 or more.
  • Shale gas production is responsible for 600,000 jobs nationally.
  • By 2035, that figure is expected to hit 1 million.