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Shale play changing the valley

February 26, 2013
dsp By CASEY JUNKINS - For The Times Leader , Times Leader

WHEELING - In one week last year, a Marcellus and Utica Shale leasing company paid about $60 million in signing bonuses to Belmont County mineral owners.

Production is now under way in Ohio and Marshall counties, meaning royalty checks worth hundreds of thousands of dollars soon will be in the mail.

Drilling and fracking are well under way in the Wheeling area, as Chesapeake Energy has activated some wells that are now producing.

Article Photos

Photo/Casey Junkins
As companies drill increasingly more Utica and Marcellus shale wells, natural gas rigs are a common sight in the Upper Ohio Valley.

North, south, east and west in the Upper Ohio Valley, the natural gas drilling boom is paying dividends for mineral owners, governments and entrepreneurs. Some examples of this are:

In both Ohio and West Virginia, a number of energy companies - XTO Energy, Gulfport Energy, Hess Corp., Chesapeake Energy, Chevron, Stone Energy, Gastar Exploration, EQT Corp. - are acquiring property and drilling and fracking wells. The natural gas they produced is being transported via a newly built pipeline network to processing companies such as MarkWest Energy, Caiman Energy, Williams, Dominion Resources and M3 Midstream.

All in all, the process is adding up to tens of billions of dollars in new investment in the local region.

"West Virginia has a proud history of producing energy, which benefits both our state and our nation," said Steve Roberts, president and chief executive officer of the West Virginia Chamber of Commerce. "The hundreds of millions in state and local government revenue will support investments in education, infrastructure and public safety, and the tens of thousands of jobs will provide income to families across our state."

As an example of how the industry is impacting West Virginia, Marshall County property values increased by $577.2 million for the 2013 tax year, largely because of oil and gas drilling.

This means the county will collect more tax dollars this year.

In Cadiz, residents admitted their village was a little quiet until the shale rush started to take hold. Now it is hard to find a parking space along the streets, as the village is bustling with activity.

With MarkWest working on its $500 million natural gas processing plant just outside the village, the company also now maintains an office along Main Street. Across the street, the Harrison County Courthouse is busy because abstractors are searching through property records in an effort to lease land for drilling.

Teresa Posada said her husband, Josh Posada, is a welder who works in the natural gas fields on projects such as compressor stations and processing plants. After traveling to work in places such as Texas and Pennsylvania, Teresa and Josh found themselves headed to Cadiz.

After settling in Cadiz, Posada said she got the idea that the town did not have anywhere for natural gas workers and pipeliners to purchase equipment they may need in the field. So instead of waiting for someone else to open a supply avenue, she decided do it herself.

Now, in a building that had been vacant for several years, Posada is running the "Utica Safety Apparel Work Gear and Supplies" store.

From steel-toed boots to fire-proof coveralls, and from safety helmets to wrenches and rain gear, Posada's store has just about everything the typical industry employee may need.

"We sell to some individual pipeliners and welders, but we are also working with some companies," she said.

Cadiz and the Harrison County Courthouse are not the only busy venues these days. Abstractors currently are lined up out the door in Belmont County and also in Tyler County.

"One day (this month), we had 52 people waiting at the door to get in at 8:30 (a.m.)," said Mary Catherine Nixon, Belmont County recorder. "Some of them are saying this could end up being like the California Gold Rush."

What makes our area so attractive to the energy companies is the abundance of natural gas liquids found in the gas stream, known as wet gas. These byproducts - ethane, pentane, butane and others - can be separated and sold for a substantially higher value than methane.

The end result of all the activity is more jobs and financial stability for the local region - a welcome change given all the negative financial news over the past decade.

 
 

 

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